We read the following story with disgust. First of all it comes from an insurance website which should be embarrassed by the lack of specificity in the facts. Secondly, the amount of money being spent in Vermont is atrocious. $168.1 million to institute the program in the small state of Vermont. One can only wonder what the amount would be in larger states like New York.
Thirdly, Vermont will only have two companies providing insurance through their exchange. Isn't that wonderful, so much for choice and options!
Fourthly, the rates quoted do not say what age this hypothetical person is to receive the premiums quoted. We would suspect it is a 20 some year old. Premiums at older ages would be substantially higher.
Fifth, it appears as if the Vermont system will not be up and running on October 1 even though hundreds of millions have been spent on it. One can only imagine what the mess will result when the manual payments are processed. Can anyone see "cluster?"
And lastly, regulators shaving 4.3% off the rates, did anyone go back and ask what the rates would have been before ObamaCrapCare? Our guess, significantly less!
The closer we get to the actual start of ObamaCrapCare, the worse it looks and the more problems that will result when it finally gets running. It will cost trillions of dollars, be very inefficient, provide very limited choice and will eliminate the plan you like. That sounds like a real recipe for success!
Conservative Tom
Vermont HIX Sets Health Plan Rates
Last April, the board of the state’s exchange, known as Vermont Health Connect, announced tentative rates subject to the approval of state regulators. This week the regulators shaved 4.3 percent off the rates initially proposed by Blue Cross Blue Shield of Vermont and MVP Health Care, the only two insurers planning to sell health plans through the exchange.
Under the revised rates, an individual purchasing the benchmark “silver plan” through Vermont Health Connect would pay $388 a month for the Blue Cross offering and $410 a month for the MVP policy. All health plans sold on the exchange must offer certain ‘‘essential health benefits” as defined by the Affordable Care Act, but fall into one of four “metal” tiers—bronze, silver, gold and platinum—that differ in terms of monthly premiums, deductibles and other out-of-pocket costs.
The premiums are similar to what a healthy individual currently pays for a similar level of coverage, according to a Blue Cross Blue Shield spokesman. But people with lower incomes who qualify for the federal tax credits and state premium subsidies offered through the exchange will pay substantially less than they do now, as will people who are currently charged higher premiums owing to a long-standing medical condition.
‘‘For those who qualify for the tax credits and premium subsidies, there’s a pretty big difference,’’ said Anya Rader Wallack, chairwoman of the Green Mountain Care Board, the state regulatory body that approved the policy rates.
As an example, a Vermont resident earning the median individual income of about $34,000 a year would qualify for subsidies that would lower the cost of the Blue Cross silver plan to around $230 a month and the MVP plan to about $252 monthly.
Around 100,000 Vermonters who currently have no health coverage will be required to purchase insurance through the exchange.
In a related development, Vermont Health Connect received this week a $42.7 million grant from the Centers for Medicare and Medicaid Services to help cover the costs of launching the new web-based marketplace. This was the fifth major federal grant Vermont has received to date to help launch the exchange, bringing the total to $168.1 million.
The money is slated for a call center, a system to process premium payments and for contingency planning against the possibility that the exchange’s IT systems are not up and running by October 1, the deadline set by the ACA for the exchange to begin selling policies. Last month, exchange officials told state legislators that, in the event of a system failure, they were preparing to “manually process” insurance enrollments at the start of October.
From the article…
ReplyDelete"The premiums are similar to what a healthy individual currently pays for a similar level of coverage, according to a Blue Cross Blue Shield spokesman. "
Note it doesn't say healthy "20-year old." It says healthy "individual." Tom, is there a chance we can agree that not all healthy individuals are 20 years old?
The $168 million is not an expense Vermont will have on a recurring basis. It is an up-front investment to get the system initially set up. Any start-up business has capital expenses to get the business launched. That is why we have venture capitalists. The federal grants are an investment that will pay dividends down the line as Vermont has improving population health statistics.
It is prudent to have the manual input backup plan in case the system is not yet ready by October. The article calls this a contingency plan. It doesn't say the system will not be operational on schedule, as you claim.
We should expect that the number of companies participating in the exchanges will correlate with the population of the state.
"And lastly, regulators shaving 4.3% off the rates, did anyone go back and ask what the rates would have been before ObamaCrapCare? Our guess, significantly less!"
No, they would be on average about 4.3% less for "similar level of coverage", according to the article. That's very good, when you consider that Vermont will now be insuring those with pre-existing conditions that the for-profit insurance companies either denied coverage completely or priced them out of the market.
You have your prediction. I have mine: Vermont will be a good model for other states to emulate. So will my state (Washington)…
http://www.reuters.com/article/2013/05/17/us-usa-healthcare-exchanges-idUSBRE94G0SB20130517
I see that my own provider (Group Health) is participating in the Washington exchanges. I have been totally satisfied with their customer service -- infinitely superior to United Healthcare. Group Health is ranked #1 in my state by J.D. Powers. That is why I switched to them.
--David
Yes, not all 20,30.70 year olds are healthy.
ReplyDeleteIf it costs $168 million to start its system and that was multiplied across the nation, that would be 8.4 billion to set up the exchanges, that aint chump change. Our guess is that the ending number will be many times that!
Yes, it is prudent to set up a manual backup because this puppy will not fly. Have you ever seen a new computer program run perfectly the first time? It never does. Just ask Microsoft about ME.
The 4.3% decrease is not over the previous rates but new rates the insurance companies proposed to the insurance bureau. It has nothing to do with the previous rates.
I am glad to hear you are satisfied with Group Health. You probably will NOT have the same policy that you had before. In Michigan Blue Cross is reducing plans from over 4000 to 44. Most plans will have to change.
Tom
You wrote, "The 4.3% decrease is not over the previous rates but new rates the insurance companies proposed to the insurance bureau. It has nothing to do with the previous rates."
ReplyDeleteYour first sentence is true, and the second sentence is false.
Here is the quote from the article: "The premiums are similar to what a healthy individual currently pays for a similar level of coverage, according to a Blue Cross Blue Shield spokesman."
So, getting the proposed rates reduced by 4.3% made them "similar to what a healthy individual currently pays for a similar level of coverage." That is a straight comparison of the Obamacare rates to the previous rates.
It won't take $168 million in every state, because most state exchanges will be run by the federal government and they will be essentially using the same system.
My Group Health policy is very good. It meets most, if not all, "essential benefits" required by plans under ACA. So I doubt it will change much. I will ask them about that.
--David