healthcare.gov

by

Ohio Health Insurance Rates – Curiouser and Curiouser

Last week I was finally able to compare this year’s insurance plans to next year’s insurance plans. The federal site, www.healthcare.gov, has finally opened up a portion of their site to “window-shopping”. Considering my curious problems using the Kaiser Subsidy Calculator, I identified  the 2nd lowest silver plan on the exchange and was surprised to find that the premium displayed looks like 2013 premiums. Since I expected most people would be shopping for 2014 insurance this was just another oddity from this web site. All was not lost. If I was correct then I had a good estimate of the 2nd lowest silver plan for 2013 and I could compare this premium to the 2nd lowest silver plan for 2014. The Affordable Care Act supporters loath to make this comparison because they do not like to be reminded that the 2013 plans for healthy people are very much like the 2014 plans except they cost considerably less.  The 2nd lowest silver plan is the benchmark used by the Affordable Care Act used to calculate the amount of subsidy everyone gets and is probably a pretty good index of how much the Affordable Care Act has increased health insurance premiums. For Ohio using my demographics, 59, married, and healthy, the 2nd lowest silver plan costs $505.84.

2013-10-11 12_57_27-Premium Estimation Tool _ HealthCare.gov

Since I cannot get 2014 prices without logging in, I chose to look up silver plans at the Anthem Blue Cross and Blue Shield web site. I chose them because they were the first well known company listed on the www.healthcare.gov screen image who probably is participating in the exchange for both 2013 and 2014. The 2014 prices on their site should be pretty similar to the 2014 exchange prices. According to their site the 2nd lowest silver plan for 2014(cbey) will cost $1246.26 or 146% higher than 2013 2nd lowest silver plan offered by the exchange. If I compare the 2014 rate to the 2013 rate for that plan it is 104% higher. This rate increase is considerably higher than the 55% to 85% estimate provided by 2011 Milliman report for Ohio that had so many people upset. It is hard to believe we are looking at a 55% to 65% increase as the good old days. Although estimates of health care cost increases are typically wrong on the low-side, the magnitude of this cost increase begs closer scrutiny and reminds me once again that my current  grandfathered plan is so much better than the exchange plans.

  1. Does this price reflected an increased risk in the individual market due to the Affordable Care Act?
  2. Does this price reflect a gaming of the subsidy market by the insurance companies? The higher the 2nd lowest silver plan, the larger the subsidies.
  3. If there is a 2014 budget for the subsidy, will this higher than expected cost for the 2nd lowest silver force the government to pay more subsidy than they were expecting?
  4. Does the price reflect a “whatever the market will bare” pricing attitude by insurance company?

 

2013-10-11 12_59_28-Anthem_HIX_ShopnQuote

by

A Little Health Exchange Humor

On Monday when my boss came into my office I said,

"After looking at the success of www.healthcare.gov I decided to push up those changes to our web site this morning. I realize that I have not tested the changes fully but I feel it is important to offer these enhancements to our customer experience even though this may prevent some of them from ordering anything. We really need to get on the agile development bandwagon."

"Nooooooooooooooooooo! Agile development is not a substitute for good testing!"

"C’mon Dave, stop being a hater. Just because our customers cannot order anything does not mean our website is a failure. Go into the bath room, look into the mirror, and tell yourself three times. Our website is an out-of-the-box success! Our website is an out-of-the-box success! Our website is an out-of-the-box success!"

At this point he got up and left my office shaking his head. I guess these born again libertarians just do not have a sense of humor.

by

Ohio Health Insurance Rates – 2013 versus 2014

Okay, let’s take another trip down the ACA rabbit hole. Since the healthcare.gov website is down I had to resort to using 3rd party systems to try to figure out how the Affordable Care Act subsidy affects me. The results were startling. I tried about six calculators and about half of them said I was not due a subsidy. Just last week the Kaiser Subsidy Calculator said I would get a $7,593 subsidy. This week its says that I am not due a subsidy. The problem with the subsidy calculators is in determining the cost of the 2nd lowest silver plan in my area. Last week Kaiser said the unsubsidized annual health insurance premium in 2014 would be $13,198. This week it says that premium is only $4,750. Hmm…

So I went to www.ehealthinsurance.com and looked up the rates for 2014. Here is what I found. The 2nd lowest silver plan for 2014 is going to be a lot more expensive than $4,750. The $4,750 may be the 2nd lowest plan for 2013 but based on the numbers below I suspect the annual premium for the 2nd lowest silver plan in 2014 is probably pretty close to $13,198. I wonder where they are getting their numbers.

ehealthinsurance_2013-10-05_08-14-11 

For kicks the screen image below is the 2013 health insurance offerings using the same demographic data. Oh my! I expected the young to get screwed but I was hoping a couple of healthy 59 year-olders would get a little grace. It is not surprising that health insurance has become costlier but I was hoping for unsubsidized prices starting at my tipping point, $500 per month. Anything over $500 a month comes out of my pocket. Hopefully my grandfathered plan increase 2014 is closer to the tipping point. If I was surprised with the 2014 plan costs and subsidies, I wonder what the 2014 ACA budget expected.

What has been surprising is the turmoil with non-subsidy people getting squeezed into lower values plans that cost a lot more. How about the situation where employees will ask their bosses to not give them a raise since it will cause them to lose their subsidy and end up costing them more money? If you find unintended consequences as raw material for commedians, then the Affordable Care Act is the gift that keeps on giving. From a health care market standpoint it is fascinating so see that the companies participating in the Ohio market dropped from 5 to 2 and the number of plans dropped from 70 to 20. The Affordable Care Act modeled itself after the highest cost, least competitive health insurance market in the country. I think they succeeded. With this type of leadership and vision, I cannot wait to see them try to bend the cost curve for this entitlement system.

2013-10-07 14_00_28-Health Insurance Quote Page

by

Probably The Smartest Thing The Affordable Care Act Has Done

A couple of years ago I purchased my health insurance using eHealthInsurance.com. It was easy to use and it had a large selection of plans available. I think that eHealthInsurance.com is what healthcare.gov and the state exchanges aspire to be when they grow up. Now I see that they have seen the future and are comfortable with letting the professionals do the work.

The federal government has signed a landmark deal setting the stage for leading online insurance exchange eHealthInsurance.com to enroll potentially millions of people on new Obamacare marketplaces being operated by the government, it was revealed Wednesday in a filing with Securities and Exchange Commission.

by

Follow-up to my Questions about Health Reimbursement Accounts

On Monday I got a phone call from a person with the Department of Labor who was following up on the questions I asked in the post, My Questions to the Department of Labor about the status of my HRA. He was nice but he did not have any answers to my questions. He had some advice. He said that the Department of Health & Human Services wrote the FAQ so I should contact them about the logic behind the HRA rulings in FAQ #11. He said that they also might be able to explain the legal status of HRA for firms with less than 50 employees. Oh well!

I went to the www.hhs.gov and www.healthcare.gov sites looking for more information on HRAs or a way to contact them. No luck! Each time I go to these sites I expect them to eventually be more like http://www.ehealthinsurance.com/ and each time I leave disappointed. When it comes down to questions I have about health insurance premiums and what alternatives I have, they are not much help. If these sites are an example of how health exchanges will be designed, we are in for a rough ride.

by

What if Individual Health Insurance Premiums do not go up as fast as expected?

Last week I found it odd that Austin Frakt chose to highlight the non-group(individual) insurance rates on the Incidental Economist. As he said in a comment he expects “the individual market will undergo more change than the group market in about a year.” That got me to thinking what if the individual insurance market does not go up as fast as he expects? The Affordable Care Act has been a cornucopia of unintended consequences.

In the health care debate individual health insurance occupies the same position as coal does in the global warming debate. The proponents of the Affordable Care Act have not gone as far as to say they are going to crucify the individual health insurance market but the intent is obvious. I have been unable to confirm their allegations that the individual insurance market policies are substandard and should be eliminated. The spearhead of the attack on the individual insurance market was the the Individual Mandate and the Essential Benefits regulations. The Affordable Care Act proponents were trying to make it easier for people with chronic, high cost health problems to get health insurance. The uncomfortable fact is that no insurance company in their right mind would want this group of people in their plans.  These people need grace and insurance is a dumb substitute. The grand idea of the Affordable Care Act was to force this group of high cost people into the insurance market with least number of people to spread the costs over, the individual insurance market. It is a dumb idea filled with malicious pitfalls. A Milliman report prepared for Ohio expects that the rates will increase 55% to 85% above the normal health insurance inflation rate. The conventional wisdom is that the healthy customers will choose to be self insured rather than pay the much higher premiums and the individual insurance market will lose its best customers. The only customers left will be those who have high medical costs. In this scenario the best case is that the individual insurance market gets smaller and in the worst case the market ceases to exist.

What if the Individual Insurance market expands?

Although I understand the rationale behind the declining individual insurance market scenario, the individual insurance customer is looking at a different health insurance picture. Here are some of the facts that may cause the individual insurance market to go against conventional wisdom and expand. The most important issue that the individual insurance market has going for it is lower cost.

  1. As a purchaser of individual health insurance I have been notified of the 2013 rate increase. Although the premium for my family plan will increase by 12% to $391 per month, the annual amount is only $4,692.  As a family who was self insured for a decade this is a competitive amount. The employer sponsored average of $15,022 is ridiculous.
  2. As a healthy family covered by a HRA who is living in a state with low individual health insurance rates, we have not paid any health insurance premiums or out of pocket health care costs in several years. When you compare this with the employer sponsored plans, the HRA is a big winner for the healthy families. The 2011 average employee contribution in the employer sponsored plans is $3,962.
  3. My insurance plan is “grandfathered”. I am not sure what this means in my specific case but a Kaiser article implies it may be exempt from the “Essential Benefits” regulation and its much higher costs.
  4. Ohio has passed a law forbidding the Individual Mandate. Since the Affordable Care Act proponents have said that the Individual Mandate is essential for the system to work, I would not be surprised if our politicians came up with an alternative plan for paying for high cost customers. Anything that spreads the cost of these customers over a much wider base is good for the individual insurance market.
  5. If you are a small or medium sized business that partially subsidizes the employee health insurance cost, the individual insurance market is very attractive. The employer sponsored contribution according to the NIHCM brief was $11,060. When you compare this price with a $6,000 HRA, a HRA is pretty attractive option that caps your health care subsidy for the future.
  6. If the states choose to implement a market based exchange using companies like www.ehealthinsurance.com rather than a state or federal exchange based on the ideas in the Affordable Care Act, it will be attractive to small or medium sized businesses to dump their employer sponsored plans. The state and federal exchanges have too much government baggage to be successful in a market place. The Affordable Care Act proponents subverted a good idea and are surprised by the lack of interest in their version of the exchange concept by the states. The government sites, http://www.healthcare.gov/ and https://www.mahealthconnector.org/, that try to provide a similar service in www.ehealthinsurance.com are pretty useless for people shopping for insurance.
by

Things that make me go hmm… HealthCare.gov Insurance Finder

I was looking at HeathCare.gov today. It is a pretty site. I was researching information about how the recent legislation impacted HRA and HSA accounts so I decided to give this site a try. It did not have anything. Their insurance finder looked intriguing so I decided to give it a test run. Since I used ehealthInsurance to get my last health insurance policy, I was hoping that they would provide something even better than eHealthInsurance. The worst case scenario I expected is that they would clone eHealthInsurance. However, they chose to provide me with several completely useless suggestions, like check into getting insurance at work. If you are looking for health insurance, HealthCare.gov insurance finder is a complete waste of time.