Out-of-pocket caps will help put the brakes on higher health plan costs

[ProSense]

Out-of-pocket caps will help put the brakes on higher health plan costs

<...>

The reality is that while high deductible plans and others that require consumers to shoulder more of the cost burden might work for the healthy and the wealthy, they simply aren’t viable for lower-income families or people with chronic illness.

That’s why, beginning in 2014, the Affordable Care Act will require individual and small group plans to cap yearly total out-of-pocket costs, including deductibles, co-pays, and co-insurance, at the levels applying to Health Savings Account plans, currently at $5,950 for a single-person and $11,900 for a family.

More importantly, these out-of-pocket caps will be even lower for individuals earning less than about $43,000 per year (or less than about $88,000 for a family of four) who purchase silver level coverage through an exchange. So we can expect out-of-pocket costs to shrink for those who can least afford them.

If these caps were in place in 2011, nearly 15 million Americans would have saved an estimated $24.7 billion that they will spend this year beyond the caps. (The caps will not apply to “grandfathered” plans – those that existed before the health law was enacted and have remained largely unchanged since then).

- more -

http://yourhealthsecurity.org/posts/2543-out-of-pocket-caps-on-health-plans-will-help-halt-the-great-migration

EXPLAINING HEALTH CARE REFORM: Questions About Health Insurance Subsidies
http://www.kff.org/healthreform/upload/7962-02.pdf

In addition to expanding Medicaid to more than 16 million Americans, the ACA also expands choice.

U.S. Set to Sponsor Health Insurance

By ROBERT PEAR

WASHINGTON — The Obama administration will soon take on a new role as the sponsor of at least two nationwide health insurance plans to be operated under contract with the federal government and offered to consumers in every state.

These multistate plans were included in President Obama’s health care law as a substitute for a pure government-run health insurance program — the public option sought by many liberal Democrats and reviled by Republicans. Supporters of the national plans say they will increase competition in state health insurance markets, many of which are dominated by a handful of companies.

The national plans will compete directly with other private insurers and may have some significant advantages, including a federal seal of approval. Premiums and benefits for the multistate insurance plans will be negotiated by the United States Office of Personnel Management, the agency that arranges health benefits for federal employees.

Walton J. Francis, the author of a consumer guide to health plans for federal employees, said the personnel agency had been “extraordinarily successful” in managing that program, which has more than 200 health plans, including about 20 offered nationwide. The personnel agency has earned high marks for its ability to secure good terms for federal workers through negotiation rather than heavy-handed regulation of insurers.

- more -

http://www.nytimes.com/2012/10/28/health/us-to-sponsor-health-insurance-plans-nationwide.html

The law could be further improved by offering Medicare for all as an option (ramp up the infrastructure) creating a federal exchange open to everyone (for the transition) and moving up the date for state waivers (benefit to states like Vermont).


End the misinformation!

[bvar22]

1. Thank You for this information.

I found the info in the first excerpt to be reassuring,
and will be studying it for further comment.
This is exactly what I was asking for yesterday.
I am kicking & Recommending your thread for wider exposure.

As of yet, the "two nationwide health insurance plans to be operated under contract with the federal government and offered to consumers in every state" (your 2nd excerpt) are speculation & promise, much like the Public Option.
I pray they will materialize, but you know how THAT goes.

[ProSense]

2. These are

"As of yet, the 'two nationwide health insurance plans to be operated under contract with the federal government and offered to consumers in every state' (your 2nd excerpt) are speculation & promise, much like the Public Option."

...actually in the law, not speculation. They are being set up in conjunction with the exchanges.

[NashvilleLefty]

3. Excellent info!

As always. Thanks!

[ProSense]

4. You're welcome.

Where have all the health care information seekers gone?

Inside joke.

[morningfog]

5. So, for Bronze level, the lowest, the deductible will be $3,000 and

the maximum out of pocket will be $5,950. And, all of that would be after the cost of purchasing the plan?

Table 1 at the internal link from the OP: http://yourhealthsecurity.org/wordpress/wp-content/uploads/2011/01/consumers_union-health_policy_brief-2011_01-what_will_an_actuarial_value_standard_mean_for_consumers2.pdf

[ProSense]

6. No

"So, for Bronze level, the lowest, the deductible will be $3,000 and the maximum out of pocket will be $5,950. And, all of that would be after the cost of purchasing the plan?"

...the cap is the cap.

Notes: Lower income families and young adults would have some additional choices.5 The sample plan designs in the table conform tothe AV standards but are only examples and not part of the legislation. Other plan designs could also comply with the new AV standards.

Actuarial Value Does Not Indicate How Much An Individual Will Pay
It will be important for consumers to understand that AV provides a measure that can be used to compare different health plans but it is not a guaranteed level of payment. In fact, few enrollees will actually pay the patient’s share as indicated by the AV measure.

The OP explanation is more concise.

[morningfog]

7. So $5,950 is the cap, including the cost of the plan, deductibles and copays?

ANything that would paid at all is included in that cap?

[ProSense]

8. From the OP:

That’s why, beginning in 2014, the Affordable Care Act will require individual and small group plans to cap yearly total out-of-pocket costs, including deductibles, co-pays, and co-insurance, at the levels applying to Health Savings Account plans, currently at $5,950 for a single-person and $11,900 for a family.

[morningfog]

9. Great. Thanks.

That clears it up. And, you're right. It was right there in the OP. As my grandfather says, if it was a snake it would have bitten me.

[TheKentuckian]

35. Premiums are separate, just like insurance now. You pay your premiums

if you need care then you pay the first $3k to meet the deductible and then you pay the percentage you are responsible for up to the maximum out of pocket.

[leftstreet]

11. No, premiums aren't 'shared costs'

So that's $5950 after premiums

[morningfog]

12. Well, goddamn, which is it. I can't get a straight answer on this.

SO, total out of pockets costs does not include the cost of the plan. It only includes deductibles, co-pays and co-insurance??

In other words, actual cost will be $5,950 plus the cost to purchase the plan. The premium, while also capped, is separate from the "out-of-pocket" cost cap. Do I have it right now?

[ProSense]

13. The straight answer: Deductibles aren't premiums either.

They're deductibles, also included in out-of-pocket expenses. See the OP, the paragraph cited here: http://www.democraticunderground.com/10021897434#post8

There is no need to make this more complicated than it is.

[leftstreet]

16. LOL n/t

[morningfog]

17. Deductibles aren't premiums, they're deductibles?

Not much of a straight answer.

I read the OP, I read when you reposted the OP. I read when you linked back to the OP.

As I read the article linked to in the OP, premiums are separate and distinct from the "out of pocket costs" which are to be capped at $5,950.

A new study shows that average monthly premiums for people who purchase health insurance on their own range from a low of $136 per month in Alabama to a high of $437 per month in Massachusetts. But, as the study notes, these monthly premium figures don’t tell the whole story.

Out-of-pocket costs, such as deductibles, coinsurance, and co-pays, ALSO are taking a hefty chunk of consumers’ budgets. That’s because health insurers have migrated many customers to policies with higher cost-sharing by using aggressive marketing campaigns and the lure of lower premiums.

Premiums may have their own cap, but it is not part of the out-of-pocket calculation.

[ProSense]

24. That's right. It was extremely clear.

OP title: Out-of-pocket caps will help put the brakes on higher health plan costs.

And this:

That’s why, beginning in 2014, the Affordable Care Act will require individual and small group plans to cap yearly total out-of-pocket costs, including deductibles, co-pays, and co-insurance, at the levels applying to Health Savings Account plans, currently at $5,950 for a single-person and $11,900 for a family.

Should have made it clear, especially since deductibles and other out-of-pocket expense were never confused with premiums before ACA.

The point is that the caps are in place. The cost sharing ensures that no one has to pay up to $30,000 in deductibles, and subsidies will lower the cost for millions of Americans.

[leftstreet]

15. Yes, you have it right n/t

[morningfog]

18. Thank you. I finally got to the answer.

The link from the OP confirms what you said.

[leftstreet]

20. +1 for your perseverance

The ACA is a 900+ page document filled with more gobbledygook and legal loopholes than the Patriot Act. The online apologists don't even understand it. They just cut/paste talking points and cross their fingers.

[ProSense]

22. This bit

"The ACA is a 900+ page document filled with more gobbledygook and legal loopholes than the Patriot Act. The online apologists don't even understand it. They just cut/paste talking points and cross their fingers. "

...of condescension from someone who posted this: http://www.democraticunderground.com/?com=view_post&forum=1002&pid=1897786

[leftstreet]

23. Thx for stalking me, but I don't see your point n/t

[ProSense]

25. Oh please,

get over yourself.

[riderinthestorm]

10. Bookmarking for reading tomorrow

Thanks for finally providing these links ProSense.

[Overseas]

14. K&R. Thank goodness!

[Fumesucker]

19. I don't read that to mean the $4,950 would include premiums

Nowhere in the text you quoted does it mention premiums being part of the $4,950.

That's my interpretation of it at least.

[morningfog]

21. You are correct. The link from the OP starts:

A new study shows that average monthly premiums for people who purchase health insurance on their own range from a low of $136 per month in Alabama to a high of $437 per month in Massachusetts. But, as the study notes, these monthly premium figures don’t tell the whole story.

Out-of-pocket costs, such as deductibles, coinsurance, and co-pays, also are taking a hefty chunk of consumers’ budgets. That’s because health insurers have migrated many customers to policies with higher cost-sharing by using aggressive marketing campaigns and the lure of lower premiums.

A 2010 Kaiser survey found that individuals with non-group coverage reported average yearly deductibles of $2,498. But cost-sharing levels don’t stop there. In Maine, for example, where average premiums are $282 per month, some plans have deductibles of up to $15,000 for individuals and $30,000 for families.

The entire point of the article is that "out-of-pocket costs" are in addition to premiums, but that the out-of-pocket costs will be capped. Capping the out of pocket costs is a good thing. But, this cap does not include premiums.

[Fumesucker]

26. Someone posted a 19th century translation of some Ovid in an OP the other day

It was a masterpiece of clarity compared to what you have to wade through to get a grasp of the PPACA.

Thirty eight percent, over a third, of Americans are living paycheck to paycheck, that's thirty eight percent for whom paying the cap will mean financial disaster.

http://www.cbsnews.com/8301-505144_162-57477881/more-americans-live-paycheck-to-paycheck/

[dflprincess]

27. But with a cap of $5,950 (single coverage) many people will still not be able to afford care

and if you can't afford the follow up - what's the point of having screening tests that are paid for?

There is growing evidence that these high deductible (aka "consumer driven&quot plans actually increase costs in the long run because people put off going to the doctor at the first sign something isn't right & those with chronic conditions do not get the routine tests they need and try to stretch their medications.

We are still desperately in need of system that actually allows people to access care, not just expects them to pay for "coverage" they still can't afford to use.

[ProSense]

28. Not everyone will hit the cap, and

as the OP points out, the out-of-pocket will be lower for the millions of Americans receiving subsidies.

There is growing evidence that these high deductible (aka "consumer driven&quot plans actually increase costs in the long run because people put off going to the doctor at the first sign something isn't right & those with chronic conditions do not get the routine tests they need and try to stretch their medications.

Preventive care is free, including cancer screening, mamograms, etc.

[dflprincess]

29. And a screening test does you no good if you cannot afford any follow up you might need

I know from personal experience that it can cost several thousand dollars to find out the weird spot on the mammogram is benign. I was fortunate to have good insurance at the time and my out of pocket was around $600. Had this happened last year when I had a $5,950 out of pocket I would not have been able to have the biopsy done. (Now I'm lucky again and have a job with decent insurance).

Not everyone who doesn't qualify for subsidies will be able to afford a $6,000 out of pocket and don't forget that the subsidy drops as income increases.

Besides the insurance companies the other big winners will be the credit card companies as Americans continue to pay for medical care with plastic.

Again, we needed access to care, not a requirement to by a product we can't afford to use.

[ProSense]

30. But that was before the ACA kicked in. n/t

[dflprincess]

36. No, it continues

If you're stuck with a high deductible plan and you make too much for any subsidy you will be out of luck when it comes to paying for any further testing, treatment or medication you may need.

The ACA does not guarantee access to follow up or chronic care and there will still be people going without or running their credit cards up until they are bankrupt to pay for the care they need.

Here's a fun fact, in 2013 the maximum deductible for a of the "consumer driven" scams will increase to $6,250 for a single person and $12,500 for a family. Meanwhile the maximum contributions a single will be able to make to a Health Savings Account will be $3,250 and $6,450 for a family.

So the rules don't even allow you put enough pre-tax money away annually to cover one year of deductible.

http://www.accountingweb.com/topic/tax/irs-raises-limits-hsas-and-hdhps-2013

[libtodeath]

31. I dont get it

i am going to have to buy insurance for an unknown amount of money but think a few hundred a month yet still will maybe pay the overpriced blood suckers almost 6,000 dollars over that?
I cant afford that if something like a heart attack or long term illness happened that needed lots of care.
Is that 6k for life or per year?
I know this isn`t single payer like we need and should have but how is it much better for me then now?

[ProSense]

32. Deductibles, co-pays and co-insurance are not new.

Some people have had to pay as high as $30,000.

That changes, but most people will never hit the cap. If you've never had to pay thousands or tens of thousands of dollars before, you're unlikely to have to pay that now. For those who have, they will no longer have to.

[libtodeath]

33. So in other words here is something not as bad

but you still cant use it without going broke?
6 grand or 30 makes no difference when you cant possibly pay it.

[forestpath]

34. That's sure what it sounds like to me, too.