Yes, people who currently have individual health insurance policies are getting letters telling them their plan will be cancelled at the end of the year. This is because their policy does not meet the standards of the Affordable Care Act. These people need to shop for a new plan – but for most of my clients it means they will be able to find a better plan for the same premium, or a lower premium, depending on their subsidy.
But not all of my individual health insurance clients will get a subsidy – and these folks are probably not going to be happy with their health insurance options. They will likely pay more money next year for a plan that is similar to what they have now.
Almost all of my individual health insurance clients have plans with a $5,000 deductible in order to keep their premium down. Unfortunately for them, even a $6,000 deductible plan will have a higher premium next year. Bonnie is a client who is 59 and very healthy, and she is paying $250 per month now. She doesn’t qualify for a subsidy, so the lowest cost plan I can find for her is around $300 per month – and it is similar to what she has now. This is bad news for Bonnie.
On the good news side, I have a client who retired early and has coverage for himself through his previous employer. His son is 19 and is currently covered by an individual plan that costs $121 per month. The father, Bill, emailed me to complain about the cancellation letter he got from the insurance company. He assumed he would pay a lot more for his son’s health insurance under Obamacare. He mentioned the “one-size fits-all” Obamacare requirements that are pushing up the cost of health insurance for everyone.
Bill is correct about the higher standards that must be part of every policy, including maternity coverage and minimal pediatric dental services. But it turns out that Bill and his son will benefit from the one-size-fits-all rule because there is now one “age band” for setting premiums for young people. Every child from age 0 through 20 pays the same premium (which can differ from company to company).
I told Bill he could get his son a Platinum plan (the most comprehensive level) through Health Net for $109 per month. This plan has no deductible, unlimited doctor visits, and co-pays for just about every service. When I read the summary of benefits for this plan, I had to call a sales manager at Health Net to ask if I was not mistaken in my understanding of the benefits. This plan seems too good for the price (which is the same for any child age 0-20). I was told it is indeed as good as I think it is.
So there are winners and losers under Obamacare. Supposedly, half of all the folks who currently have individual health insurance will qualify for a subsidy – so they will be winners when they shop for a new plan. But the other 50%, who make too much money for a subsidy, will pay more for their health insurance next year. Those who have a $10,000 deductible plan will definitely pay more – and they probably don’t want better, or more comprehensive coverage. They will be losers under Obamacare.
For the millions of people who do not have any health insurance coverage today, around 90% are expected to get a subsidy to help them pay for their health insurance. These folks will be winners under Obamacare.
I don’t understand why there should be losers under Obamacare. I think that person with the $10,000 deductible plan should be allowed to keep it. That type of policy should no longer be sold, but why shouldn’t the people who already have those plans be grandfathered? If they want a better policy, they could get one in 2014. If they want to keep the low-cost, bare-bones policy, they should be able to keep it.
I’ve said the person responsible for the healthcare.gov website should be fired. I think the person who did not see this policy cancellation issue coming should also be fired. Once again, the simple solution was missed: letting people keep their high-deductible plans that have been issued since 2010. All plans sold since 2010 include preventive services and a number of other provisions required under Obamacare.
Instead of good news stories about people getting better, lower-cost health insurance, Obamacare opponents are broadcasting the bad news about cancellation letters and higher costs for the Obamacare losers. All this negative news is caused by changes that do not seem necessary.