By Mary Johnson, editor
Obamacare troubles are far from over, as many consumers who thought they had new coverage are beginning to learn the hard way. Many of the problems stem from continued health exchange dysfunction.
Even as the Obama Administration was declaring that the government's online federal health exchange, www.HealthCare.gov, was "fixed" on December 1, a growing chorus of health insurers, healthcare advocates, and computer techs warned that the portion of the system that relays enrollment information to insurance companies remained inoperable. In addition, a key component responsible for sending premium subsidy payments to the companies, due by January 1st, had not even been built.
Consequently, TSCL believes that by the time you read this, thousands of new Obamacare enrollees may still be without the health coverage they thought they were supposed to have. Those who do have a plan may discover that it's not the plan they picked, they are paying the wrong premium, or are getting hit with unanticipated and high out-of-pocket costs.
One of the stickiest problems are the 1.5 to 5 million people whose health plans were cancelled because the plans did not conform to the new policy requirements. During last fall's cancellation furor, Obama administration spokesmen said that consumers would find "a good selection of health plans, offering richer benefits on the new federal and state exchanges." They also said that the cancelled plans with low premiums "often lacked basic benefits and carried high deductibles or out-of-pocket costs."
But many Obamacare plans ALSO come with high price tags and "super - size" out-of-pocket costs. While the plans may cover a "richer package of benefits," many of the new plans come with high deductibles — as much as $6,000. Deductibles are the amount consumers must pay in full before plans cover the cost of services, including even routine visits to the doctors. Concern is growing among advocates, including TSCL, that many consumers would get almost no benefit under such plans. Even more troubling is the restricted access to doctors and major hospitals. Most of the plans are structured as HMOs. Critically ill patients with cancer and other serious diseases are learning they can't keep their doctors, and major hospitals and treatment centers are excluded from their health plans.
Case in point: I paid $311 per month for health insurance last year. At age 62 the lowest premium of any federal health exchange plan in my area (without subsidies) is $475 per month. In 2013 my deductible was $750. The exchange plan has a $6,000 deductible. This means if I purchased this plan I would pay $6,000 out-of-pocket before coverage even kicks in. For me, since I’m in reasonably good health, I would only benefit if I was hospitalized or diagnosed with a major illness. To get a plan with a $750 deductible, my monthly premium would go up by nearly 150% from the $311 that I paid last year — to about $775.
A new analysis by the Avalere health policy group confirms that most chronically ill people who get coverage through the new marketplaces will be underinsured, even if they get help with premiums and out-of-pocket costs because they are low-income and would only be able to afford the high deductible plans.
Medicare may be next for super-sized deductibles. Some studies indicate that seniors with Medigap supplements use more healthcare services than seniors in other plans. Medigap plans cover most or all of Medicare hospital and medical deductibles and co-payments. That, critics say, provides an incentive to see doctors more often, and drives up costs. To cut government spending, Congress is considering measures that would require higher deductibles and cost-sharing so seniors will reduce their use of medical services. Surveys by TSCL indicate that 72 percent of seniors strongly oppose the proposal.
How were your healthcare costs affected with the New Year? Are you affected by Obamacare? Take TSCL’s 2014 Senior Survey.
Sources: "Study: Many In Marketplace Plans Will Be Underinsured Because of High Out-of-Pocket Costs," Rebecca Adams, CQ Healthbeat, December 5, 2013.