Skip to comments.Unexpected Health Insurance Rate Shock-California Obamacare Insurance Exchange Announces Premiums
Posted on 05/26/2013 11:24:17 AM PDT by HawkHogan
Yesterday, Covered Californiathe name given to the healthcare exchange created pursuant to the Affordable Care Act that will serve the largest population of insured citizens in the nationreleased the premium rates submitted by participating health insurance companies for the three health insurance program categories (bronze, silver and gold) established by the Affordable Care Act, along with the catastrophic policy created for and available to those under the age of 30.
Upon reviewing the data, I was indeed shocked by the proposed premium ratesbut not in the way you might expect. The jolt that I was experiencing was not the result of the predicted out-of-control premium costs but the shock of rates far lower than what I expectedeven at the lowest end of the age scale.
So, why the all too popular narrative that Obamacare would mean unaffordable healthcare premium costs for so many Americans?
Setting aside the never-ending nonsense peddled by the opponents of healthcare reform, everyone from the Congressional Budget Office to numerous private actuaries have warned that premium shock could be expected to set in once the public began to see the reality of what Obamacare would mean to their pocketbooks. And yet, the only real jolt to the system being felt by these public and private prognosticators today is utter amazement over just how reasonable the California prices have turned out to be.
(Excerpt) Read more at forbes.com ...
Actually this is only for the insured individual (age not specified) who is in the highest income bracket of 250%-400% of the Federal Poverty Level (FPL) those under 150% FPL have 94%.
I wonder if standard operational definitions for the ten essential benefits are stated somewhere or if the categories are just names.
For example, a plan could include “prescription drugs” but the actual included list is so restrictive as to be useless, or no better than what Walmart offers at $4 anyway.
It’s really going to be treacherous for the consumer to make their decisions. I’m not looking forward to it. Fortunately, I do have basically full time to research.
This is the same state that, if you have a medical issue and cannot afford to get anything done about it (no insurance) - just go out there, live with a friend or family for a month or two, and you qualify for MediCal - and they will pick up the tab for you...
I speak from indirect experience - my brother-in-law’s own inlaws... went to visit family in California, a little over a month after arriving, his back troubles (had been having issues already - and indeed had a history of back trouble and surgery) got bad again. Having no insurance, they were worried. Family said “no problem” - he signed up for MediCal and had the surgery a couple weeks later. No question asked, other than how long have you been California... They told the truth.
Even more interesting - his mother-in-law got a surgical consult about maybe getting lap-band surgery done (she is very overweight). And found out that MediCal would pay for that too... Foot- most insurance wont do those procedures....
Nothing if you're over 65.
I agree that it does not take the subsidy into account if that’s what you mean.
You are correct. I was also surprised at how low the introductory rates were. Kind if like 0% interest on a credit card for six months, then 19.9%. It won’t last, especially when reality hits about actual costs. It also seems these are just individual premiums. If you have children, especially if you have more than one or two, paying by individual is going to be horrible.
is there any way to opt out of this?
Sure, join a union or pay a penalty are a couple of ways (actually, most unions have not been given a waiver, but they sure do want one!).
Boston’s “Big Dig” project: Government estimated coat $2.8 billion. Actual cost: over $14.6 billion
Nearly 7x what we wee told. Why should this be any different?
Years ago,I had a high deductible, basically catastrophic health insurance policy offered by a professional society to which I belonged. There was low profit motive for the insurer , and the premium was reasonable to begin; but the increases in the annual premiums were so high that they had to beg off and drop the program once the real costs hit.
That is the co payment picked up by the insurance company. Federal subsidy is on premium.
Anyone who doesn’t think that these are “loss leaders” is an idiot. Virtually every insurance company, cable company, phone company, lawn care company, basically, any company that provides a service low-balls to get new business. They are all desperately trying to attract healthy, young people who will pay the premiums. Let’s see what these rates look like in a few years and/or how many people over 50 who need a kidney transplant actually get one while on any of these plans, gold or not. For all I know, “gold” gets you what you got in the USSR, circa 1973.
Say you're single in a non-tech field with an income of $40K. So you'll pay 10% of your income for health insurance, 25% in federal, state and local taxes and probably about 5% (or more) in transportation. So before your rent is paid, 40-50% of your income is already gone.
In addition, we now have to pay for extra layers of state and federal insurance bureaucracy. Such a deal!
However, it is possible that in socialist states like California and Washington, the state has always been more involved in health care than the average state. Oregon, too. These west-coast states may know their potential subscribers better than, say, Idaho which has had minimal involvement in health care. The worst-case projections may yet come to fruition in those less interventionist states. Rate stability is anyone's guess.
what do you get for a bronze, silver and gold?
Nothing if you’re over 65.
This is absolutely NOT TRUE. You get a “wellness shot” and a nice hi-impact biodegradable plastic urn.
CALIFORNIA FUDGES OBAMACARE MATH (Bloomberg 5-24-13)
Bloomberg doesn’t allow us to post here. Follow link:
Well, a couple of things. One, is that these are not "Government estimated costs" and not estimated at all. These are actual first-year (proposed) premiums. Second, these companies will not be paid by anyone to "make up the difference" if their actual costs go higher. It is not any variation of cost-plus and there will be no re-negotiated contracts for the year. Premium stability is another issue altogether and as I've said, this will be interesting to watch.
I agree with one thing he says there — that it is necessary to differentiate between states that have had heavy health insurance involvement all along - like California - from others. That’s what I said a few comments ago. OTOH, his “fudge the math” accusation doesn’t seem so persuasive. He is claiming that each one of these private companies is engaged in some sort of a conspiracy to affect public opinion. That seems silly to me.
I looked at my spouse's paycheck deductions for a family of four. The employer pitches in too, making the cost for a family of four over $20,000 a year.
Having worked for 20 years in the private insurance field for multiple health insurers, I know that these premiums still result in a loss or at most up to a 3% ROI for the insurer, who knows what they're doing.
The IRS doesn't know what they're signed up for, but it will increase their industry-ignorant bureaucracy for sure.
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