California has unveiled prices that consumers will pay for a selection of health plans offered through the state under the Affordable Care Act, providing a glimpse into how health care reform may look as it is rolled out across the nation.
Under the federal health care reform law, people who do not get or cannot afford health insurance through their jobs can buy coverage through an exchange, at a group rate negotiated by state regulators.
The cost to a 40-year-old who needs coverage would vary from about $40 to $300 per month for a mid-level plan in California, depending on income. Some young adults, who are less expensive to cover, could pay nothing, depending on how much they earn.
The prices in California, along with those announced in Washington, Vermont and other states, show that premiums under "Obamacare" can be more affordable than had previously been thought. Consumer advocates welcomed the new exchange.
"It's a revolutionary improvement to move from a broken market where people are charged by how sick they are, to a competitive market where people pay what they can afford, based on a percentage of their income, on a sliding scale," said Anthony Wright, executive director of advocacy group Health Access.
"Most consumers buying coverage in the individual market will get financial help and see their premiums go down," he said.
The sweeping federal reform law seeks to extend health insurance to many of the 49 million Americans without it, and alter how care is delivered so as to curb what has been an inexorable rise in healthcare spending.
Republicans who oppose the law had predicted that high premiums would sink Obamacare as the uninsured would not be able to afford coverage even with federal subsidies.
http://news.yahoo.com/california-reveal ... 00803.html
This might just work. Read the article for more on scaled pricing. It's interesting to say the least. Maybe my brother in law can now go see a dr when he gets sick instead of getting the rest of our family sick because he can't afford to go get some antibiotics...
Reason: added the link
"The exchange will offer four basic plans, ranging from least to most generous. In the Bronze plan, which is the cheapest, an enrollee would pay 40 percent of his average medical expenses until he reached an annual $6,350 out-of-pocket maximum. In the Platinum plan, which is the most expensive, the patient would pay 10 percent of her medical expenses until she hit the $4,000 out-of-pocket limit."
http://www.ocregister.com/articles/heal ... hange.html
I haven't read where an individual who is getting subsidized for the cost of their premium will also get subsidized for the cost of their co-pays, etc. People need to understand the basics of insurance and policies when they sign up for these plans or they could get some ugly surprises down the line as they start utilizing the services and then find that they still will have to pay something.
Also as I understand it, the subsidy comes in the form of a tax credit. Therefore individuals will have to pay up front for the premium and then wait to file their taxes to get the tax subsidy. I have not read anywhere that there will be an automatic deduction to the cost of the premium up front.
When was the last time government was correct on the cost of anything?
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I'm not so sure about that. The people I know in that situation are well aware that it's going to come out of their pockets. They've been waiting to find out how much they're going to have to come up with.Tommy Tar wrote:Tens of millions of people think their going to get free health care.
John Q. Public
Good point. The war in Iraq and the cost of the F-35 are prime examples.Tommy Tar wrote: When was the last time government was correct on the cost of anything?
John Q. Public
Rate Shock: In California, Obamacare To Increase Individual Health Insurance Premiums By 64-146%
One of the most serious flaws with Obamacare is that its blizzard of regulations and mandates drives up the cost of insurance for people who buy it on their own. This problem will be especially acute when the law’s main provisions kick in on January 1, 2014, leading many to worry about health insurance “rate shock.”
Last week, the state of California claimed that its version of Obamacare’s health insurance exchange would actually reduce premiums. “These rates are way below the worst-case gloom-and-doom scenarios we have heard,” boasted Peter Lee, executive director of the California exchange.
But the data that Lee released tells a different story: Obamacare, in fact, will increase individual-market premiums in California by as much as 146 percent.
Lee’s claims that there won’t be rate shock in California were repeated uncritically in some quarters. “Despite the political naysayers,” writes my Forbes colleague Rick Ungar, “the healthcare exchange concept appears to be working very well indeed in states like California.” A bit more analysis would have prevented Rick from falling for California’s sleight-of-hand.
Here’s what happened. Last week, Covered California—the name for the state’s Obamacare-compatible insurance exchange—released the rates that Californians will have to pay to enroll in the exchange.Obamacare to double individual-market premiums
“The rates submitted to Covered California for the 2014 individual market,” the state said in a press release, “ranged from two percent above to 29 percent below the 2013 average premium for small employer plans in California’s most populous regions.”
That’s the sentence that led to all of the triumphant commentary from the left. “This is a home run for consumers in every region of California,” exulted Peter Lee.
Except that Lee was making a misleading comparison. He was comparing apples—the plans that Californians buy today for themselves in a robust individual market—and oranges—the highly regulated plans that small employers purchase for their workers as a group. The difference is critical.
If you’re a 25 year old male non-smoker, buying insurance for yourself, the cheapest plan on Obamacare’s exchanges is the catastrophic plan, which costs an average of $184 a month. (That’s the median monthly premium across California’s 19 insurance rating regions.)
The next cheapest plan, the “bronze” comprehensive plan, costs $205 a month. But in 2013, on eHealthInsurance.com (NASDAQ:EHTH), the average cost of the five cheapest plans was only $92.
In other words, for the average 25-year-old male non-smoking Californian, Obamacare will drive premiums up by between 100 and 123 percent.
Under Obamacare, only people under the age of 30 can participate in the slightly cheaper catastrophic plan. So if you’re 40, your cheapest option is the bronze plan. In California, the median price of a bronze plan for a 40-year-old male non-smoker will be $261.
But on eHealthInsurance, the average cost of the five cheapest plans was $121. That is, Obamacare will increase individual-market premiums by an average of 116 percent.
For both 25-year-olds and 40-year-olds, then, Californians under Obamacare who buy insurance for themselves will see their insurance premiums double.
Impact highest in Bay Area, Orange County, and San Diego
In the map below, I illustrate the regional variations in Obamacare’s rate hikes. For each of the state’s 19 insurance regions, I compared the median price of the bronze plans offered on the exchange to the median price of the five cheapest plans on eHealthInsurance.com for the most populous zip code in that region. (eHealth offers more than 50 plans in the typical California zip code; focusing on the five cheapest is the fairest comparator to the exchanges, which typically offered three to six plans in each insurance rating region.)
As you can see, Obamacare’s impact on 40-year-olds is steepest in the San Francisco Bay area, especially in the counties north of San Francisco, like Marin, Napa, and Sonoma. Also hard-hit are Orange and San Diego counties.
According to Covered California, 13 carriers are participating in the state’s exchange, including Anthem Blue Cross (NYSE:WLP), Health Net (NYSE:HNT), Molina (NYSE:MOH), and Kaiser Permanente. So far, UnitedHealthCare (NYSE:UNH) and Aetna (NYSE:AET) have stayed out.
Spinning a public-relations disasterThere's a lot more
It’s great that Covered California released this early the rates that insurers plan to charge on the exchange, as it gives us an early window into how the exchanges will work in a state that has an unusually competitive and inexpensive individual market for health insurance. But that’s the irony. The full rate report is subtitled “Making the Individual Market in California Affordable.” But Obamacare has actually doubled individual-market premiums in the Golden State.
How did Lee and his colleagues explain the sleight-of-hand they used to make it seem like they were bringing prices down, instead of up? “It is difficult to make a direct comparison of these rates to existing premiums in the commercial individual market,” Covered California explained in last week’s press release, “because in 2014, there will be new standard benefit designs under the Affordable Care Act.” That’s a polite way of saying that Obamacare’s mandates and regulations will drive up the cost of premiums in the individual market for health insurance.
But rather than acknowledge that truth, the agency decided to ignore it completely, instead comparing Obamacare-based insurance to a completely different type of insurance product, that bears no relevance to the actual costs that actual Californians face when they shop for coverage today. Peter Lee calls it a “home run.” It’s more like hitting into a triple play.
http://www.forbes.com/sites/theapotheca ... by-64-146/