Health-insurance policies can vary widely in how well they’ll serve you and how much they’ll cost you. Here are some critical things to know — such as, for starters, not just to look at the premiums charged.
Food writer Michael Pollan and countless grandmothers are right: Ideally, we should tend to our health, and that should, in general, reduce our medical expenses. But life doesn’t always unfold in ideal ways, and most of us will face healthcare costs in our lives.
Those costs are likely to be hefty, too. Our nation’s healthcare costs recently topped $3 trillion, accounting for more than 17% of our gross domestic product (GDP). Per person, that’s about $9,900, with much of it paid out of pocket. Given that average, and the fact that a course of some medications cost more than $100,000, health insurance is rather vital for most of us.
Don’t buy health insurance blindly, though, as policies can vary widely in how well they’ll serve you. Here are some critical things to know.
Figure out where you’ll get your coverage
First off, give some thought to where you’ll get your health insurance. If you’re 65 or older, Medicare is probably your best bet. “Original” Medicare includes Part A (hospital coverage) and Part B (physician/medical insurance). Part A is free, and Part B costs most people just $134 per month this year. You’re allowed to opt for a Medicare Advantage plan, sometimes referred to as Part C, instead of original Medicare, and some of those plans charge no premium at all.
Next, look to your employer or your spouse’s (or domestic partner’s) employer. This is generally a more affordable route to health insurance than other options, as employers typically pay a portion of the cost — and sometimes a sizable portion. On average, in private industry and in state and local government, employers pay close to 70% of premiums, with workers paying about 30%. (Single workers tend to pay an even smaller percentage than those on family plans.)
The next best option is likely your local health-insurance exchange, created because of the Affordable Care Act (ACA, or Obamacare). A visit to Healthcare.gov can direct you to your local exchange.
The ACA appears to be in the process of being repealed and replaced by the present administration in Washington, but it’s not gone yet. For now, it offers subsidies to keep policies affordable to those with limited means — and more than 80% of people who enroll through the exchanges receive a subsidy to help them afford their premiums.
The ACA also requires all plans to offer certain minimum levels of coverage that are greater than what many plans offered in the past. In some circumstances, such as if you’re quite young, a plan on your local exchange may even be more affordable than what your employer offers.
As Congress struggles to repeal and replace the Affordable Care Act, a different, far less visible problem is playing out in state capitals and in health insurance offices across the country.
This is rate-setting season, the time of year health insurers must tell state and federal regulators how much they plan to charge for premiums, starting in January. The filing deadline for Ohio insurers is Monday, June 5.
Companies including Medical Mutual of Ohio, Anthem Blue Cross and Blue Shield, Akron-based Summa and Canton-based AultCare have no firm idea how much to charge — and it’s not because of the healthcare bill stirring up so much dust among the public. Rather, it’s because of a political calculation by President Donald Trump over an arcane feature of the Affordable Care Act, better known as Obamacare.
Trump hasn’t said whether the federal government will continue to make payments called cost-sharing reductions — next year, or even next month. And he’s hoping the uncertainty he creates drives Democrats to get on board the Obamacare repeal-and-replacement bill he backs, called American Health Care Act.
If the cost-sharing reductions stop, companies will have to raise rates dramatically — if state and federal governments let them amend those rate requests — or exit the Obamacare market. Healthcare policy analysts say Trump is playing a reckless game.
“It’s either a total misunderstanding of the market or an attempt to destroy it,” J. B. Silvers, a former insurance executive who teaches health care finance at Case Western Reserve University’s Weatherhead School of Management, said. “There’s no middle ground.”
“Unfortunately,” said Sabrina Corlette, a research professor at Georgetown University’s health policy center, “I do think the president perceives the CSRs as some kind of bargaining chip.”
The Trump administration and House of Representatives Republicans say Obamacare, not Trump, has been reckless from the start.
What it’s about:
Health insurers are at the mercy of Trump’s executive power over cost-sharing reductions. The feature is one way the federal government until now has picked up a share of health care costs for the working poor.
Cost-sharing operates behind the scenes, with the government paying deductibles, co-payments and coinsurance to keep health care affordable for about 7 million low-wage Americans. It is largely unrelated to the taxpayer subsidies that individuals get to help pay their monthly insurance premiums.
Trump is threatening to take away these cost-sharing payments.
Doing so could drive up insurance prices on the ACA exchange – the online sales channel on which ACA individual and family policies are sold — by an average of 19 percent, according to calculations by the Kaiser Family Foundation. Unless the companies could recoup the money by suddenly raising premiums, the loss would drive more insurers from the market, because the ACA still requires that insurers provide the price breaks – and insurers say they cannot afford to absorb them.
Without a way to recapture the cost, “we would likely have to exit on the exchange,” Doug Bennett, who directs individual market sales for Medical Mutual, said.
Trump won’t say what he plans to do, although the White House recently said it wants another 90 days to decide how to proceed in a court case challenging the cost-sharing payments. In a different discussion, Trump budget Director Mick Mulvaleny told Congress last week that the White House hasn’t yet decided on whether it will even make cost-sharing payments for June.
Signing up for coverage on the health insurance marketplace should be easier for some people this fall because new federal rules will allow brokers and insurers to handle the entire enrollment process online, from soup to nuts.
Some consumer advocates are concerned, though, that customers going this route won’t get the comprehensive, impartial plan information they need to make the best decision due to the financial self-interest of insurers and brokers.
“Facilitating the participation of brokers and getting web brokers involved is a good thing for the market,” says Timothy Jost, an emeritus professor of health care law at Washington and Lee University School of Law in Virginia. But he says there are risks for consumers. “If you’re enrolling with a web broker, you could see ‘best deals’ that often aren’t the best deal for you but are the best deal for the people who are marketing them.”
The guidance was released May 17 by the Centers for Medicare & Medicaid Services, which oversees the online marketplaces. It will streamline the enrollment process for people who work directly with an insurer or broker to shop for coverage for 2018 on healthcare.gov, the federal marketplace in more than 30 states. States that run their own marketplaces aren’t affected by this change.
Get Set For Trump Revisions To Your Affordable Care Act Insurance
SHOTS – HEALTH NEWS
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The presumption is that people will continue to buy insurance through the marketplace this fall.
In the past, people could start the online enrollment process with a broker or insurer, but then they had to bounce off the broker’s or insurer’s website to go to the federal marketplace website to see if they were eligible for premium tax credits, among other things. In theory, they then could return to the insurer or web broker to complete the enrollment process. In practice, many didn’t — though they may have enrolled elsewhere, either completing the process on healthcare.gov or with another vendor.
This fall, healthcare.gov consumers with straightforward enrollment needs will be able to complete the entire process on one website. Complex cases and those involving a special enrollment period, for example, will still have to go through the original multi-step process.
The staff at online health insurance broker eHealth is thrilled with the change.
“It’s a big deal,” says Nate Purpura, vice president of consumer affairs at eHealth. “Many people, including our CEO, have been to Washington, D.C., multiple times to explain the benefits of being able to help in this way.”
The eHealth website, which works with 180 insurance carriers nationwide, offers about 75 percent of the plans that are available on healthcare.gov, Purpura says.
That’s a problem, say some policy analysts. Federal rules require web brokers to display basic information about all the plans that are available on the federal marketplace, whether or not they actually sell them. It includes the name of the plan and insurer that offers it, the type of plan — HMO, PPO, EPO — and metal level (bronze, silver, gold or platinum.) Web brokers must also publish a disclaimer that says the website information about all the available marketplace plans might not be complete and provide a link to healthcare.gov.
But the information web brokers present about plans they sell and get a commission for may be much more comprehensive than the information provided about plans they don’t handle.
On a broker’s website, “consumers won’t necessarily have the full range of options,” says Elizabeth Hagan, associate director of coverage initiatives at Families USA, a consumer advocacy group. “On healthcare.gov, the plan display is the same for all the options, and consumers have the ability to sort plans based on what they want.”
CMS suggests that brokers not sort their plans in such a way that consumers could be steered to policies from which brokers receive a commission. It also suggests that brokers not run ads or information about other insurance products in the marketplace plan selection area. But these are suggestions, not requirements.
In addition, some analysts are concerned that people who don’t sign up through healthcare.gov won’t receive important notifications about their coverage from insurers and web brokers. In the past, for example, some people have lost their coverage after enrolling outside healthcare.gov because they weren’t directed to make their initial “binder” payment, or first month’s premium, says Sarah Lueck, a senior policy analyst at the Center on Budget and Policy Priorities, which has filed comments on proposed enrollment rules.
Enrollment this fall will run for just six weeks, from Nov. 1 to Dec. 15, a significantly shorter time period than in previous years. Encouraging brokers and insurers to sign people up may help more people get signed up in that time frame.
“This is another important step to help create stability in the health insurance market,” CMS Administrator Seema Verma said in the press release announcing the new process.
But some analysts remain concerned that details about how consumers’ privacy and security will be protected under the new system are still too vague.
“This is really sensitive information, people’s tax information, which needs to be highly protected,” says Jost. “There are a lot of concerns with confidentiality and privacy. I have some concerns about fraud.”