Obamacare Premiums to Soar in Most States

As we anticipated … we are now hearing from the media how much Obamacare premiums will be, and who is really going to pay.  Read the post below on CNNMoney for more information.

By Tami Luhby | CNNMoney.com – Tue, Aug 6, 2013 5:57 AM EDT

Reuters – A Tea Party member reaches for a pamphlet titled “The Impact of Obamacare”, at a “Food for Free Minds Tea Party Rally” in Littleton, New Hampshire in this October 27, 2012 file photo. REUTERS/Jessica …more 

Get ready to shell out more money for individual health insurance under Obamacare … in some states, that is.

While many residents in New York and California may see sizable decreases in their premiums, Americans in many places could face significant increases if they buy insurance through state-based exchanges next year.

That’s because these people live in states where insurers were allowed to sell bare-bones plans and exclude the sick, which has kept costs down. Under Obamacare, insurers must offer a package of essential benefits — including maternity, mental health and medications — and must cover all who apply. But more comprehensive coverage may lead to more expensive insurance plans.

Under Obamacare, all Americans must have insurance coverage starting in 2014 or face penalties of $95 or 1% of family income, whichever is greater. Enrollment in the exchanges begins October 1, with coverage kicking in in January. Plans will come in four tiers, ranging from bronze to platinum.

Some lightly regulated states, including Indiana, Ohio, Florida and South Carolina, have recently released preliminary rate information highlighting steep price increases. Unlike the blue states of California and New York, these are Republican-led states that have strongly opposed the Affordable Care Act, as Obamacare is officially known.

Comparing this year’s and next year’s plans isn’t easy because the structure of the plans is so different. Each state comes up with its own method.

Behind the numbers in 3 key states. In Florida, for instance, officials constructed a hypothetical silver-level plan based on the offerings available today. Then they looked at how the cost of that plan compares to the average silver plan that will be available on the exchange. Florida found premiums will rise between 7.6% and 58.8%, depending on the insurer. The average increase would be 35%.

The main driver of the premium increases is the Obamacare mandate that coverage be offered to everyone, said Kevin McCarty, Florida’s insurance commissioner. There are just short of a million enrollees in the individual market in Florida, while 3.8 million are uninsured. The state does not allow new entrants into a “high-risk pool,” which provides coverage to the sick.

“People who are in their 50s with high blood pressure have no coverage options,” he said.

Ohio, meanwhile, said there would be an average increase of 41% by comparing a trade association’s report of premiums for all plans available today with the average premium expected on the exchange.

Indiana officials said prices would rise an average of 72%. But they were looking at the cost of providing care, not actual premiums.

All of these rate hikes must still be reviewed by the federal government and do not take into account the fact that Americans with incomes up to $45,960 for an individual and $94,200 for a family of four will be eligible for federal subsidies.

So why aren’t there such big premium increases in other states? New York, for example, already required that insurers provide comprehensive coverage to all who apply. Rates there could fall by half since the pool will expand to include many younger, healthier residents under Obamacare. But New York is more the exception than the rule, experts said.

Rate hikes depend on age and gender. To give consumers a better idea of how premiums will change, CNNMoney took a look at the plans provided by one insurer: Physicians Health Plan of Northern Indiana.

Our analysis found that 21-year-old men will pay a lot more for an exchange plan, but 42-year-old women and 62-year-old men will shell out less for a silver-level plan that comes with a $2,500 deductible and a roughly $25 co-pay for office visits.

Under this scenario, a young man’s monthly rate will rise to $214 on the exchange next year, up 63% from today. The woman, however, will pay $284, a drop of more than 7%, while the older man will be charged $615, a nearly 6% decrease. This is because Obamacare requires that women pay the same amount as men and does not allow insurers to charge older participants more than three times the young.

Physicians Health expects most enrollees to sign up for bronze or silver plans, which have lower monthly premiums but carry higher deductibles and co-pays, according to Jim Brunnemer, the insurer’s chief financial officer. Today, its members typically buy high deductible plans.

While premiums may go up in these states, Obamacare advocates say people will receive more comprehensive coverage. Also, the law limits the amount people have to pay out-of-pocket for deductibles and co-pays to $6,350 in 2014.

“A lot of people will get more for their money,” said Sarah Lueck, senior policy analyst for the Center on Budget and Policy Priorities. “Even people paying a higher rate will benefit. It will be a big change in most states.”

View this article on CNNMoney

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As always, we will be your source for the Open Enrollment beginning October 1, 2013.  Give us a call or visit our website for quotes and to determine if you qualify for a subsidy, how much and how to apply.

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Consumer Healthcare Guide to the Reform

There is much debate over if this Reform is good, bad or ugly.  What is clear, is that it is going to impact every one of us; consumers, employers, insurance companies, hospitals and doctors.

While everything doesn’t really get “kicked in” until 2014, people are already getting prepared, and things are changing.

Here are some things as it is now, and what is to come.  Since change is constant … please visit us often to keep up!!!

I don’t have health insurance. Will I have to buy it and what if I don’t?

Today, you are ok if you don’t have health insurance (well you won’t be fined that is). Starting in 2014, depending on your income and possibly other factors, you will have to have it or pay a fine (or tax – not sure what they are calling it).  This tax may be able to be waived for several reasons, including financial hardship or religious beliefs.

They are estimating millions of people will qualify for Medicaid or federal subsidies and will be able to buy insurance that way.

I have group coverage at my job, will I be able to keep that? Will my benefits change?

If your company provides insurance, it will probably stay that way. Your employer is not obligated to keep the current plan, so they can change premiums, deductibles, co-pays and/or the network coverage.   We have seen a lot of small employers under 50 making a lot of changes because of the reform.  In addition, you may have already seen some companies making dependant changes; what already took effect was the fact that the plans had to guarantee that an adult child up to age 26 who can’t get health insurance at a job could stay on their parents’ health plan.

I can’t afford health insurance, but I want it. What do I do?

The federal government’s plan is, depending on your income, you can apply for Medicaid. Currently, in most states nonelderly adults without minor children don’t qualify for Medicaid. But beginning in 2014, the federal government is offering to pay the cost of an expansion in the programs so that anyone with an income at or lower than 133 percent of the federal poverty level,  will be eligible for Medicaid.   What if you don’t qualify for Medicaid and still can’t afford health insurance?

Then there are the government subsidies that you may be eligible for.  They help you pay for insurance bought through the exchanges, which should be available October 2014. This will be private insurance from insurance companies offered to individuals and small businesses. We plan to be one of the agencies offering these plans to you as well.

What if I have a pre-existing condition, will it be harder for me to get coverage?

After 2014, Insurers will not be able to decline an applicant based on health status.  That is good and bad.  If you are healthy, you want to get insurance NOW, and possibly lock in a lower rate while you can be underwritten.  Once all plans are treated the same, the rates are anticipated to be much higher and a healthly person will be paying much more.

I am a small employer. Do I have to buy health insurance for my employees?

You are not required to provide insurance. Starting in 2014, employers with 50 or more employees that don’t provide health care coverage and have at least one full-time worker who receives subsidized coverage in the health insurance exchange will have to pay a fee of $2,000 per full-time employee. The firm’s first 30 workers would be excluded from the fee.

Small employers with 50 or fewer people won’t face any penalties.

In addition, if you own a small business, the health law offers a tax credit to help cover the cost. Employers with 25 or fewer full-time workers who earn an average yearly salary of $50,000 or less today can get tax credits of up 35 percent of the cost of premiums. The credit increases to 50 percent in 2014.

We offer many solutions to help you work through the law and get all the credits and eliminate the penalties.  Click for more info.

I’m over 65. Is it going to affect my Medicare?

The law has made a lot of good and bad things happen for beneficiaries.  With the changes, more and more doctors are not taking Medicare, which is the main negative.  The reason why is because they are basically not getting paid as much.  This is more and more reason to have additional coverages to Medicare.  Click to see more.

The good things the law did was it expanded Medicare’s coverage of preventive services, such as screenings for colon, prostate and breast cancer, which are now free to beneficiaries. They pay for an annual wellness visits to the doctor. Preventative care is so important in keeping healthy, so use these FREE services!   Because the law reduced the payments to Medicare Advantage plans, some say these cuts could mean the Advantage plans may not offer many extra benefits, such as free eyeglasses, hearing aids and gym memberships, that they now provide. The reason for the cuts was because Medicare Advantage costs more per beneficiary than traditional Medicare.

Will I have to pay more for my health care because of the law?

That is a million dollar question and an argument no one knows the answer to.

That said, there are some new taxes and fees. For example, starting in 2013, individuals with earnings above $200,000 and married couples making more than $250,000 will pay a Medicare payroll tax of 2.35 percent, up from the current 1.45 percent, on income over those thresholds. In addition, higher-income people will face a 3.8 percent tax on unearned income, such as dividends and interest.

Starting in 2018, the law also will impose a 40 percent excise tax on the portion of most employer-sponsored health coverage (excluding dental and vision) that exceeds $10,200 a year and $27,500 for families. The tax has been dubbed a “Cadillac” tax because it hits the most generous plans.

In addition, the law also imposes taxes and fees on several major health industries. Beginning in 2013, medical device manufacturers and importers must pay a 2.3 percent tax on the sale of any taxable medical device to raise $29 billion over 10 years. An annual fee for health insurers is expected to raise more than $100 billion over 10 years, while a fee for brand name drugs will bring in another $34 billion.

Those fees will likely be passed onto consumers in the form of higher premiums.

In our opinion, being in the insurance industry for over 30 years, we feel very sure people under 30 will pay more after 2014 than what they would pay right now for the same plan.  People over 55 will pay a little less than what they might pay now.  Overall, premiums are going to go up for everyone we estimate 12%-20% across the board maybe more, sadly we do not feel they will be going down at all because of the reform.

Other parts of the law now in place:

You are likely to be eligible for preventive services with no out-of-pocket costs, such as breast cancer screenings and cholesterol tests.   Health plans can’t cancel your coverage once you get sick – a practice known as “rescission” – unless you committed fraud when you applied for coverage.

Children cannot be denied coverage even if they have pre-existing conditions, however the companies can rate up for that condition; some up to 800% of the premiums.  FYI – This has adversely cause the companies to stop offering child-only policies.  This will apply to adults in 2014.

Insurers will have to provide rebates to consumers if they spend less than 80 to 85 percent of premium dollars on medical care.  You may have already gotten some money back from the insurance company on your policy and wondered what it was for.

Some existing plans, if they haven’t changed significantly since passage of the law, do not have to abide by certain parts of the law. For example, these “grandfathered” plans can still charge beneficiaries part of the cost of preventive services.

If you’re currently in one of these plans, and your employer makes significant changes, such as raising your out-of-pocket costs, the plan would then have to abide by all aspects of the health law.

The law has already hit some obstacles:

For example, the law created high-risk insurance pool (PCIP) to help people purchase health insurance. But enrollment in the pool has been less than expected. As of Aug. 31, 86,072 people had signed up for the high-risk pools, but the program, which began in June 2010, was initially expected to enroll between 200,000 and  400,000 people. The cost and the requirements have been difficult for some to meet.   Applicants must be uninsured for six months because of a pre-existing medical condition before they can join a pool. And because participants are sicker than the general population, the premiums are higher.  (What does this tell you?  If in 2014 nobody can be declined by an insurance company, then wouldn’t insurance be more expensive?)

Enrollment has increased since the summer, after the premiums were lowered in some states by as much as 40 percent and some states stepped up advertising.

As always visit our blog, subscribe to our newsletter, become a fan, however you wish … stay up to speed on the HealthCare Reform with us.  We will make sure we keep you up-to-date with the most accurate information we have.

If you need a health quote go to www.FreedomFreeQuote.com
If you need a medicare supplement quote go to www.eMedigap411.com
If you need life insurance go to www.HelpMeBuyLifeInsurance.com

Or just call us 877-740-8683 we will be happy to help you!