By Mary Johnson, editor
Obamacare wasn't open for more than 30 days before two million people had lost their healthcare coverage – triple the number who were able to enroll up to that point. Unfortunately, I was one of them. I was offered other options, including one that would have increased my premium costs as much as $5,568 in 2014.
Despite President Obama's oft-repeated assurance that, "If you like your health plan, you can keep your health plan," I knew that wasn't how it would work, and so did he! My plan wasn't "grandfathered" because it was purchased after the 2010 Affordable Care Act was signed into law. The truth is, few plans would qualify for grandfathering by now anyway. Insurers, employers, and individual consumers make changes every year, and insurers frequently close plans.
Misleading statements aside, what made the mass cancellations so unprecedented are the sheer numbers of people thrown out of their plans, and the uncertainty about finding affordable policies in time for them to avoid a lapse in coverage. Obamacare is totally new and untested, and, in most states, entirely dependent on an Internet-based federal health exchange, Healthcare.gov, which is critical to determining what you pay for coverage.
The October 1st roll-out was a stunning fiasco, and the website was down, or only working on a limited basis, the first 30 days of Open Enrollment, preventing most of the public from enrolling in plans. Without a functional exchange, people can't easily learn what plans are available, the costs, and most important, to learn if they qualify for subsidies, actually advance tax credits that lower premiums – let alone enroll. If people who qualify for the subsidies forego the exchange and purchase coverage directly, they pay the full, unsubsidized cost. That can result in substantially higher premiums.
I finally opted for a temporary extension of my 2013 plan. That included a 15% jump in premiums, and I still will need to enroll in a new exchange plan that becomes effective before the end of the year. Although Healthcare.gov is working somewhat better now, there's a lot more to fix about Obamacare than just the website. Here are 3 key issues affecting seniors under age 65:
- High costs: Officials say that the new plans offer richer benefits and that people in poor health won't have to pay as much. But people in better health have to pay more, and for many who have lost existing coverage, it can be much more. Even with a subsidy, to keep a plan similar to what I have now would require a premium increase of about $80 a month, double my deductible to $1,500, and increase my maximum out-of-pocket by $1,000 to $5,500.
- Limited networks of providers: The new health plans are relying on much smaller networks of doctors, hospitals, pharmacies and other providers. In my area, the only plans available on the federal exchange are HMOs. That means I need to go through a primary care physician for referrals to specialists. Plans are imposing surprising new tiers on providers, like they do with drug formularies. For example, under Anthem plans offered for my county, the near-by prestigious University of Virginia Hospital, is a "tier II" provider, meaning I would have a higher co-pay if I use services at that hospital. New enrollees need to check their plan's provider networks and learn about the new tiers. Patients who receive care from out-of-network providers would get stuck with paying the full cost of the bill.
- Tax surprises. Most people are aware there's a tax penalty for not having insurance by the deadline. Uninsured people need to enroll in a health plan by March 31, 2014, to avoid the penalty. But people can also wind up with a big tax surprise if they fail to estimate their income correctly for premium subsidies. If you take the full subsidy, and your income is higher than you originally thought, you may wind up having to pay some (or all) of it back on your 2014 tax return. It's important to report changes of income in a timely way, or you have the option of either taking a partial subsidy or foregoing it altogether.
Are you under 65? If so, how have you been affected by Obamacare? Contact us.