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Sticker Shock' Ahead on Health Insurance
'Sticker Shock' Ahead on Health Insurance
By David Pittman, Washington Correspondent, MedPage Today
Published: February 05, 2013
WASHINGTON -- Separate surveys released this week give dramatically different outlooks for two groups of people under the Affordable Care Act (ACA): the young, healthy worker and the part-time worker.
Premiums for a healthy, nonsmoking, 27-year-old in a "bronze" -- or relatively inexpensive -- small-group or individual policy would increase on average by 169% in five markets in 2014, a survey of major health insurers by the conservative American Action Forum (AAF) found.
Meanwhile, premiums for an unhealthy, 55-year-old smoker in a more generous gold-rated policy would decrease by 22%, on average, in those same five markets in 2014.
"The results surveyed above indicate that there will be massive sticker shock to the relatively young and healthy in both the small group and individual markets," the AAF report said. Those increases essentially subsidize the ACA mandated coverage of sicker individuals and limits on variations in premiums between groups of insured such as men and women, the report noted.
ACA mandates coming in 2014 include the mandate for individuals to purchase insurance; minimal coverage requirements for insurers; coverage of pre-existing conditions for adults; limits on premium variation based on age, gender, health status, or group size; new fees and taxes; and other new rules.
The AAF sought to understand how these changes would play out in different markets. It sent a survey to an unspecified number of major insurers and asked them to forecast the ACA's impact on small-group and individual plans in six cities.
Results showed premiums would increase for young, healthy individuals by an average of 190% in Milwaukee and 157% in Phoenix -- the city with the lowest increase for the group.
To put a dollar amount on that, the average current monthly premium in Chicago, Phoenix, Atlanta, Austin, and Milwaukee is $2,047 for young, healthy workers in a small-group plan. The AAF survey found it will jump to around $5,124 in 2014 with the ACA changes.
However, premiums would drop 32% for older, less healthy individuals in Austin, Texas, the largest drop for the surveyed cities, and by 15% in Milwaukee, the smallest drop for a city.
Premiums for older, less healthy workers in a small-group plan in those same five cities would drop from $14,534 today to $10,706 next year, the AAF survey found.
Both groups of enrollees would be helped economically in some cases by federal tax credits available for those making between 100% and 400% of the federal poverty level, if they purchased insurance through a health insurance exchange.
"By eliminating or constraining these 'rating factors' that result in the variation in today's market, the ACA in 2014 increases the premium for the young and healthier and lowers the premium for the older and sicker," the AAF survey said. "The same would be true if there were a law reforming automobile insurance."
The AAF survey didn't specify which health insurers participated in its survey but did say it wouldn't have published results without at least four respondents for each city. Albany, N.Y., was the only city it asked about whose results weren't published.
A separate survey from the ADP Research Institute, also released this week, says the ACA's penalties for employers to offer coverage to employees could result in more of today's part-time workers receiving coverage.
"The shared responsibility provision of the ACA may result in employees who are currently classified as part-time being reclassified as full-time, meaning the employer must offer coverage to those employees or face a potential penalty," ADP's 2012 Study of Large Employer Health Benefits said.
In 2012, 23% of all employee positions were classified as part-time and only 15% of those were eligible for benefits, the survey found. The survey was based on roughly 300 companies with at least 1,000 employees.
The ACA mandates that any employee working at least 30 hours per week, or 130 hours per month, must be offered employer-sponsored health coverage that meets certain requirements if the business employs 50 or more full-time workers.
"The ACA will require employers to extend health coverage to more part-time employees, and employers need to carefully consider the best approach for their organization," the report stated.
On Monday -- the same morning the AAF released its survey -- Health and Human Services Secretary Kathleen Sebelius said the government must reach out to young people currently uninsured who may not know they can gain federal assistance to buy coverage through a health insurance exchange or marketplace. Young people are particularly tough to reach, she noted.
"If we're going to fulfill the full promise of the Affordable Care Act and insure millions of Americans, we need to reach these people," Sebelius said Monday.
http://www.medpagetoday.com/Washington-Watch/Reform/37205
Love your comments, they are very informative, interesting. I love reading both sides of a story.
Pre existing can apply to a child as well who grows to an adult and through no fault of their own they have no insurance.
Not every parent can cover their child until the child can get their own ins. There are probably many different stories.
I appreciate your insight, I have been complaining about how much money I pay in premiums for medical, dental, extra dental and vision, and then still have to pay $350 for a pair of glasses when I should be grateful that I can get insurance in the first place.
Thank you again.
Pre existing can apply to a child as well who grows to an adult and through no fault of their own they have no insurance.
Not every parent can cover their child until the child can get their own ins. There are probably many different stories.
I appreciate your insight, I have been complaining about how much money I pay in premiums for medical, dental, extra dental and vision, and then still have to pay $350 for a pair of glasses when I should be grateful that I can get insurance in the first place.
Thank you again.
I have to ask..what extra healthcare do your Canadian relatives carry? The only extra available is supplemental which will cover dental and prescriptions. And it's not expensive - in fact, my employer carries it for us. But if your carrying it on your own, it's pretty cheap. Other then that, there is no such thing.
And I'm curious - how does your Dr. create a surgical time slot?
Btw, I'm not being sarcastic, I'm genuinely interested in this...how does one do that?
The biggest misconception over National Health Care is this belief that the gov't interferes someone. They don't. If you wait 4 days for surgery, it's because your triaged as a priority status that is lower then someone elses. For example, anything life threatening, or an emergency like appendicitis or something will go first.
I had a biopsy 2 and a half weeks ago. I got my results today. I was offered my surgical slot next week. And this is non life threatening...it's a pre cancerous condition. Is that unreasonable? I actually turned down next week as I need some time to plan this (I'll be out of commission for about a month). I was offered the option of March 6th. I turned that down too, so I'm having it done March 28th. All my choice...this is bad?
And I'm curious - how does your Dr. create a surgical time slot?
Btw, I'm not being sarcastic, I'm genuinely interested in this...how does one do that?
The biggest misconception over National Health Care is this belief that the gov't interferes someone. They don't. If you wait 4 days for surgery, it's because your triaged as a priority status that is lower then someone elses. For example, anything life threatening, or an emergency like appendicitis or something will go first.
I had a biopsy 2 and a half weeks ago. I got my results today. I was offered my surgical slot next week. And this is non life threatening...it's a pre cancerous condition. Is that unreasonable? I actually turned down next week as I need some time to plan this (I'll be out of commission for about a month). I was offered the option of March 6th. I turned that down too, so I'm having it done March 28th. All my choice...this is bad?
Employer Requirements Under the Law
There are no requirements on employers with 50 or fewer full-time employees.
Larger employers — with 51 or more workers — will have to make a payment if they don’t offer insurance. The penalty is $2,000 per full-time worker, excluding the first 30 workers.
There’s no penalty for not offering coverage to workers who are only part-time.
Businesses that provide coverage must make an affordable offer to employees, who can’t pay more than 9.5 percent of their household income for insurance. If they do, they’ll receive a tax credit to buy their own insurance on state-based exchanges, and their employers will be assessed a payment of the lesser of $3,000 per employee receiving the credit, or $2,000 per employee, excluding the first 30 workers.
Small businesses with fewer than 25 workers and average annual wages under $50,000 qualify for tax credits. They must contribute at least half of the premium costs. For 2010-2013, the credits cover up to 35 percent of a business’ contribution. Starting in 2014, the credit goes up to 50 percent of the employer’s contributions for two years.
http://www.factcheck.org/2012/02/gops-job-killing-whopper-again-2/
There are no requirements on employers with 50 or fewer full-time employees.
Larger employers — with 51 or more workers — will have to make a payment if they don’t offer insurance. The penalty is $2,000 per full-time worker, excluding the first 30 workers.
There’s no penalty for not offering coverage to workers who are only part-time.
Businesses that provide coverage must make an affordable offer to employees, who can’t pay more than 9.5 percent of their household income for insurance. If they do, they’ll receive a tax credit to buy their own insurance on state-based exchanges, and their employers will be assessed a payment of the lesser of $3,000 per employee receiving the credit, or $2,000 per employee, excluding the first 30 workers.
Small businesses with fewer than 25 workers and average annual wages under $50,000 qualify for tax credits. They must contribute at least half of the premium costs. For 2010-2013, the credits cover up to 35 percent of a business’ contribution. Starting in 2014, the credit goes up to 50 percent of the employer’s contributions for two years.
http://www.factcheck.org/2012/02/gops-job-killing-whopper-again-2/
(including the doctors... sorry, forgot to mention the professionals that are defrauding & abusing, because there are MANY)
"...I think they need to do something about the doctors and the medicaid and medicare fraud..."
Holy crap... never were TRUER words spoken. Medicare & Medicaid work fantastically well, but for the abuse. If there weren't so many people on it, that didn't need to be on it, those that are abusing, those that are defrauding, etc, etc... there wouldn't be all the endless checks & verification's slowing down the already painfully slow process.
If you removed those abusers & users, the system would be slimmer and you'd be able to do away with the verification's & checks, thereby making it a quicker process.
And a byproduct (side-effect) of removing those users & abusers... the cost would drop, making it totally and completely manageable with our current 'revenue' stream.
Look at that. I agree with you on something. What a nice way to head into the weekend!
Holy crap... never were TRUER words spoken. Medicare & Medicaid work fantastically well, but for the abuse. If there weren't so many people on it, that didn't need to be on it, those that are abusing, those that are defrauding, etc, etc... there wouldn't be all the endless checks & verification's slowing down the already painfully slow process.
If you removed those abusers & users, the system would be slimmer and you'd be able to do away with the verification's & checks, thereby making it a quicker process.
And a byproduct (side-effect) of removing those users & abusers... the cost would drop, making it totally and completely manageable with our current 'revenue' stream.
Look at that. I agree with you on something. What a nice way to head into the weekend!
I should have said, unless you are also self employed, I pay more taxes than you. Of course I know not your situation and I should not assume that you are not yourself self employed.
I am at a crossroads right now, but I will figure it out.
I think they need to do something about the doctors and the medicaid and medicare fraud and the ones that do get a medical card from the state need to answer for how often they go or take their kids to the doctor just for every little tiny thing. I have seen people take their kids to the doctor a few times a week for nothing but a runny nose, then to the dentist where they put spacers, pull baby teeth and give caps to 5 year olds, then off to therepy so the little ones can talk about the evils of their mom and dad for getting divorced and such.
I knew a woman who is retired who got three knee surgeries within 2 years because, the doctor screwed it up and medicare paid for it. I could go on and on and on. How about the missing fathers being held to carrying medical on their children and enforcing the child support so all these women dont have to be on the system getting what the father was ordered to do and its never enforced.
Lots of problems with that and until some of these issues are addressed and unless they are, we are staring at single payor universal. It will do away with medicaid, ssi, and all those programs everyone is complaining about. It is the answer, its just a matter of time imo.
I am at a crossroads right now, but I will figure it out.
I think they need to do something about the doctors and the medicaid and medicare fraud and the ones that do get a medical card from the state need to answer for how often they go or take their kids to the doctor just for every little tiny thing. I have seen people take their kids to the doctor a few times a week for nothing but a runny nose, then to the dentist where they put spacers, pull baby teeth and give caps to 5 year olds, then off to therepy so the little ones can talk about the evils of their mom and dad for getting divorced and such.
I knew a woman who is retired who got three knee surgeries within 2 years because, the doctor screwed it up and medicare paid for it. I could go on and on and on. How about the missing fathers being held to carrying medical on their children and enforcing the child support so all these women dont have to be on the system getting what the father was ordered to do and its never enforced.
Lots of problems with that and until some of these issues are addressed and unless they are, we are staring at single payor universal. It will do away with medicaid, ssi, and all those programs everyone is complaining about. It is the answer, its just a matter of time imo.
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