What’s This? Healthcare Premiums Could Rise Under Obamacare?
March 28, 2013 by Ben Bullard
PHOTOS.COM
The Patient Protection and Affordable Care Act — you know it as Obamacare — inches closer and closer to revealing itself as the social-engineering bill of goods many Americans saw it for, from the moment it first passed in 2010.
This week’s revelation? That coverage premiums will actually rise — for the demographic most in need of the so-called affordable care — as the new law comes online.
That admission comes from no less than a member of President Barack Obama’s cabinet: Kathleen Sebelius, secretary for the U.S. Department of Health and Human Services (HHS).
Next year is the first fiscal cycle that many of the Obamacare plan’s most sweeping provisions are set to take effect. Ahead of the changes, insurance companies are due to start making their 2014 rates known in coming weeks.
“As a former insurance commissioner I have watched what transparency does to a market. This is the first time ever in the history of the United States that insurance companies have to file their rates, it has to be very transparent, they have to offer the same kind of coverage without 5,000 tiny little lines and internal caps, and they have to compete for customers,” Sebelius told reporters Tuesday. “And I am a believer in the market strategies that in and of itself will minimize the rate impact.”
The idea that Obamacare “forces” insurers to be transparent in their rates schemes, and thereby introduces a self-correcting bit of market competitiveness that’s supposed to drive coverage prices down, has been a major point of contention. From Day One, the Obama Administration has put its full faith in the idea that insurers will reduce their prices in order to stay competitive.
But then, according to The Wall Street Journal, Sibelius said this of young people and others who are currently either without healthcare coverage, or who are underserved by their current insurance:
These folks will be moving into a really fully insured product for the first time, and so there may be a higher cost associated with getting into that market. But we feel pretty strongly that with subsidies available to a lot of that population that they are really going to see much better benefit for the money that they’re spending.
Truth is, no one knows what insurers’ rates will look like for customers new to the Obamacare-influenced market next year; but there’s a lot of reason to start saving now. A study released this month indicates that per-person medical claim costs under individually insured plans could jump 32 percent, on average, once the law is in full effect. Add to that a separate WSJreport last week that insurance companies are already cautioning brokers to get ready for a steep increase in individual and small business-sponsored healthcare plan premiums in 2014.
Sibelius’ comments Tuesday simply mark her as one of the first Obama officials to actually acknowledge that plain fact — however grudgingly.
This guy quotes the 32% number, but this is not about premiums. The study states (page 4)…
ReplyDelete"Note that the ACA’s affect on premium is not modeled in this research; rather, long-term relative claims cost is modeled. Many aspects of the ACA will affect premiums, including changing benefit designs, new taxes and assessments, federal risk mitigation programs, minimum loss ratio rules, rate review rules, and premium subsidies."
http://cdn-files.soa.org/web/research-cost-aca-report.pdf
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Your own headline should read "some" premiums will increase. For example, the insurance companies can no longer discriminate on the basis of age or sex in setting premiums. Old people and men generally cost the insurance companies more money than young people and women, and they adjusted their premiums accordingly. Under ACA, this will end.
Only those at the high-end, such as young people in the individual market who will have their benefits upgraded under ACA, will have large increases in premiums, and many of them will, therefore, qualify for subsidies (as Sebelius indicated).
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Regarding rescissions (dropping your coverage when you get sick and become unprofitable to a for-profit insurance company)…
"An investigation and hearings last year by the House Committee on Energy and Commerce challenged those claims. They found many troubling cases where the pre-existing conditions were trivial, unrelated to the claim, or not known to the patient. "
http://www.nytimes.com/2010/05/03/opinion/03mon1.html?_r=0
--David
20,000 recisions by the top 3 carriers over 5 years is an absolute drop in the bucket. This is a typical New York Times article that makes a mountain out of a mole hill.
DeleteMost of those recissions were due to omissions (not disclosing material facts). In other words they lied about the issue. They don't deserve to have the insurance. They are stupid idiots who thought they could outsmart the company. I have no synpathy for them.
I just learned about Services Corp. Did you know about this?
ReplyDelete"The law also increases the number of health care providers—including mental and behavioral health providers and those serving medically underserved communities. The National Health Services Corp, for instance—a program of the Department of Health and Human Services that provides loan-repayment assistance and scholarships to health care providers serving medically underserved communities—tripled in size over the past three years. Doctors and nurses supported by this program are providing care to 10.4 million patients across the country. In 2012 the Department of Health and Human Services invested more than $229 million in the Services Corp."
http://www.americanprogress.org/issues/healthcare/news/2013/03/25/57946/only-3-years-old-the-affordable-care-act-is-already-having-a-big-impact/
--David
Just another bureaucratic mess that is going to make sure we get single payer in less than ten years.
ReplyDelete>20,000 recisions by the top 3 carriers over 5 years is an absolute drop in the bucket.
ReplyDeleteSo does that excuse it?
Besides, if each of these people would have cost the for-profit insurance company $1 million before they die, the companies saved themselves $20,000,000,000. That makes it profitable to hire staff to research and claim rescissions.
The way they do it: If you get a major illness that they know will make you unprofitable for them in the future, they comb through your medical history and search for anything omitted in your application. It can be some trivial thing totally unrelated to your cancer or heart disease (e.g., childhood asthma). That is enough for them to drop you. It could be that you did not even know you had the pre-existing condition. That is not a lie, if you did not know it. They just need to claim that the condition is far enough advanced that it must have pre-existed.
--David
They LIED or omitted vital information which would have prevented them from getting insurance. A basic part of law is the concept that if there is not a meeting of the minds, there is no contract. When you LIE or OMIT information, there was NO agreement.
DeleteThe application covers hundreds of conditions, if you don't disclose, it is your fault, not the insurance company's.
"Just another bureaucratic mess that is going to make sure we get single payer in less than ten years."
ReplyDeleteThe 10.4 million patients living out in the hinterland and getting medical services because of this program would probably disagree. You complain about shortage of primary care physicians, but criticize a good working program to address the problem.
--David
"They LIED or omitted vital information which would have prevented them from getting insurance."
ReplyDeleteOkay, those are legitimate rescissions. I don't have a problem with that.
The problem is that they also drop patients who honestly did not know that they have a pre-existing condition (never diagnosed prior to the insurance) but medical evidence clearly indicates that the disease pre-existed.
As I said, another example would be some trivial condition that is not related to the patient's major medical problem (cancer, heart, diabetes, etc.). They dig through the patient's medical history looking for these kinds of things. For example, I have Raynaud's syndrome. It will never cost my insurance company a dime and doesn't cause other diseases, but they could use it as an excuse for a rescission if I forgot to put it on my application. You can argue that it is legal under the terms of the contract, but it is a scum-bag thing for an insurance company to do to a person just diagnosed with a catastrophic illness and facing multiple hospitalizations and surgeries. THAT is what we should be talking about. Obamacare stops them from doing this #$%#!
--David