The Affordable Care Act, like most health care reform efforts, focuses on people without insurance. That’s fine, because those people do face significant problems obtaining health care in the United States.
But underinsurance is a real concern, too, and it’s often ignored.
via Underinsurance Remains Big Problem Under Obama Health Law – NYTimes.com.
This article in the NYT illustrates basic insurance concepts that should be obvious, but aren’t to many people. First, the affordable issue for health care is not the insurance premium and second, you can’t have both low out-of-pocket costs and low (or if you prefer, “affordable”) premiums.
Of course that is quite obvious to policy makers if for no other reason than the Medicare example. Medicare has no out-of-pocket limits, there are high deductibles on hospitals stays with overall stay limits and beneficiaries purchase additional coverage to protect them from these expenses; not to mention Part D.
Now that Obamacare has been in operation almost a year, the concepts of insurance are hitting home and we are again faced with the question I have been asking for four years; “how do you define affordable health care.?” Politicians have been throwing the word around for years and the general public has been lapping up the rhetoric while no one bothered to ask what it means.
If you read the NYTs article you will see it frets over health care costs exceeding 5% or 10% of a household’s income. In other words, for a family earning $55,000, a health plan with a $2,500 deductible comes close to the 5% and adding in coinsurnace easily exceeds 5%.
Never mind the bronze, silver, gold and platinum plans under Obamacare, employers have been raising cost-sharing for years, many doing so via the high deductible health plan. For 2015 the IRS says such a plan must have a minimum deductible of $2,600 and total-out-of-pocket costs (excluding premiums) can be as high as $12,900 for a family.
One of the biggest challenges in store for people as they start to use their health plans in 2015 will be dealing with high deductibles. Nearly one-third of employers are offering only high-deductible plans with no alternative, according to the National Business Group on Health, and people who buy insurance on their own are choosing high-deductible policies as a way to lower their ever-rising premiums. The average bronze plan on the state health insurance exchanges had a deductible of more than $4,300 in 2014, according to a study by Avalere Health. SOURCE: Kiplinger.com
Is this underinsurance?
After all the debate for the last six years and more we still focus on two things, the price we pay for health care services and shifting costs to individuals to help lower premiums while we should be focusing on why, what and how we receive health care.
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