I just found out about this yesterday—I’m not sure when it got posted. The Alabama Department of Insurance is in the process of deciding which package of Essential Health Benefits will be required for the insurers that participate in Alabama’s Exchange. On their website, they are requesting public comments, but the deadline is in 3 days. I only found out because one of the organizations I belong to was asked to provide feedback—and I’ve searched the Internet including al.com without finding any press mention of this opportunity. Could it be they don’t really want to hear from you?
So if you want to weigh in, do it quickly! Quick review on Essential Health Benefits (EHB)—these will be the covered items insurers are required to include in order to be allowed into the Exchange. States are supposed to choose a benchmark package from 4 types of plans already in place in that state. It isn’t the insurance product itself that will be on the exchange, just what will have to be covered. Here’s a chart with the plans that meet requirements in Alabama, along with comparisons of benefits. Whatever is noted as required in the federal rules will have to be added to the EHB package, whether it is in the benchmark plan chosen or not. States can add extra to the benchmark EHB they pick, but they can’t subtract.
Just by scanning quickly, you can see that some plans cover more than others. Pay attention to the “prior authorization required”, because these are tricky to use sometimes. I don’t know why some of them don’t cover local anesthetic (like getting lidocaine before having stitches, or trigger point injections). Guess they don’t like people who get trigger point pain. Which services look best for you and your family and which do you expect to need in the next few years? Will you have trigger points? Will you need genetic testing? Yep, just like with Medicare Part D, you need ESP. That’s part of your personal responsibility, after all. I have a few patients with the plan that has the most checkmarks, the FEHBP column, and it seems pretty decent. That’s my guess as the best pick.
Most likely Alabama will be pressured by insurers to pick the skimpiest version possible. The number of items included in the EHB does not appear to affect the premium (unless I’ve misread that section of ACA, entirely possible), so they can cover a smaller range of services.
If you think this doesn’t apply to you because you already have employer group insurance, think again—some analysts expect there will be a significant percentage of companies who will drop group insurance, because the penalty is cheaper than the premium. This could have a domino effect. So it is probably worth your time to think about what you want covered.
Why are the services covered important, if out of pocket costs are now limited and the insurer can’t turn you away based on medical history? Because if your condition is best treated by a service they don’t cover, it DOES NOT APPLY to your out of pocket maximum. That amount is all on you, and it is in addition to whatever you have to pay for premiums and cost-sharing (deductibles and co-pays).
The out of pocket costs, even with the maximum, are pretty substantial in some cases. The Kaiser calculator is interesting—play around with it some. There are complaints it may far underestimate the predicted premium costs because of medical inflation, so take it as a low-end estimate. If you qualify for the subsidy, you don’t get the money beforehand—you have to either file for it the next year on your taxes or ask for it to be paid in advance straight to the insurer, based on what you predict your income will be. If you are wrong and get too much subsidy, you will have to pay some or all of it back as a lump sum, depending on your income. There are concerns that the planned methods to estimate subsidies are not going to be very accurate. One dollar too much in income can boot you from being subsidized to suddenly owing thousands of dollars.
Even if you do it correctly, try the calculator as a 40 year old heading a family of 4, making 40K a year, in a medium cost area. You will only have to pay about $1900 of the premium yourself, if you use advance assignment of your subsidy to the insurer—you can only do this if you buy the “silver” plan of 70% actuarial value, meaning the plan would pay on average 70% of a standard population’s total cost (so does not mean it will cover 70% of your personal cost). You can get a lower premium for the “bronze” plan (60% actuarial) but then no subsidy. Want gold (80%) or platinum (90%)? Tough luck for you, unless you can buy out of pocket, in which case you are a 1% member and I need to ask you for a donation to my favorite charity.
After that $1900, you’ll be on the hook for a max of $4100 out of pocket more, for a total of about 6K. If you are making 40K and caring for a family of 4, do you have 6K a year for medical costs? That’s over 10% of your salary, meeting the usual definition for underinsurance. With what you have left, you are almost poor enough for Medicaid, meaning SOL in Alabama.
That’s why the EHB package really matters, because if you have to buy another $2000 or so of non-covered services, you aren’t going to be able to pay for the rent or groceries or something essential to life.
If you are a 50 year old, in a family of 4 with total family income of 100K in a medium cost area, your premium would be around 16.8K in 2014, no subsidy available, with additional out of pocket cost of 12.5 K maximum. That’s about 29K you might be out for covered medical costs, almost a third of your pretax income—so you don’t want much to be uncovered. There goes the college fund.
If your insurance would cost more than 8% of your income—true for most of us including me— you don’t have to pay a tax or penalty or whatever the Court would like to call it, for not getting insurance. You can wait until you get sick and buy the policy, but you’ll still have to shell out then.
Numbers making your head spin? Have a champagne hangover from last week? We could eliminate all this number crunching and guesswork quickly. Put the heat on for HR 676, Medicare for All. Prepay through taxes at far less than your current premium—it’s Constitutional. Then go to the doctor without your credit cards, to get the care you need. Forget about the Medicaid Expansion and the state’s General Fund shortfall, who will do AllKids, the subsidy estimates, and insurers tricking you out of your money. Medicare for All: everybody in, nobody out.