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Well, Obama never said, “if you change your plan you can come back to it later if you decide you don’t like the ACA plans.”</p>
<p>“Give the mitten to” is, as you surmise, an obscure phrase meaning to dump.</p>
<p>Great article, calmom, with an excellent neutral tone. </p>
<p>It says, “Because insurers are required to maintain one participant pool for all their individual market participants in a state…”
I didn’t realize that. But if it’s true, then what you say about GPs pool is incorrect. If an insurer has one risk pool for the entire state, then it doesn’t matter that GP’s plan that got away would have older and sicker participants. On the other hand, that plan would have higher premiums because its costs are higher. Also, the premiums would go up a lot right away, because the healthy participants in that plan are now being mixed with the relatively more unhealthy new enrollees in other plans.
Read more: [Here</a> Are The Five Big Reasons Obamacare Changes Insurance Premiums - Business Insider](<a href=“Here Are the Five Big Reasons Obamacare Changes Insurance Premiums”>Here Are the Five Big Reasons Obamacare Changes Insurance Premiums)</p>
<p>I think that is referring to post-ACA requirement, not to the grandfathered plans. I can’t find any citation to back up that statement anyway. I think it probably refers to the risk-adjustment provisions of ACA – I don’t think grandfathered, non ACA-compliant plans are part of that. </p>
<p>One other thing to factor in is that GP’s low rates – and mine – are a by-product of a rating practice that is not allowed in ACA-compliant plans – that is, the practice of using risk factors such as past health history to set rates. Many people with the exact same plans have been paying more for their premiums because their premiums were adjusted upwards because of health issues --those could be relatively minor factors, such as a history of taking prescription medication for acne or ADHD. I’m raising this because I’m having difficulty seeing how an insurance company could be required to use a statewide risk pool but still allowed to charge differential rates to its subscribers by health status on the grandfathered plans. So if they do have to use the statewide pool, that may be another reason a large premium increase is anticipated on the older plans – the first thing the companies might do is count heads to see who is left on the old plans and then set a single rate category for each age group, rather than health-based differentiated rates. So that would tend to drive up rates for anyone who had preferential rates before.</p>
<p>yeah, cf, I’m gonna use that one tomorrow!! Aha, I got her (my sister), no way she knows that one! I can see the obscenities flowing through my text inbox already.</p>
<p>Interesting article, calmom, thanks. Though it seemed really negative for people in the individual market. I don’t think I’d want to have to negotiate that market, unless I was getting highly subsidized. It sounds that if you have an income greater than the subsidized level, you are taking a big hit. Yet it would be awesome for those who have been struggling to get insurance when they are ill.</p>
<p>Here’s an article about the risk pools and ratings under ACA:
<a href=“http://www.actuary.org/files/Premium_Change_ACA_IB_FINAL_050813.pdf[/url]”>http://www.actuary.org/files/Premium_Change_ACA_IB_FINAL_050813.pdf</a></p>
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<p>I interpret this to be regional, not state-wide – and to apply to premiums for the ACA metal-category policies. If it’s not, then it would mean that GP’s old plan HAS to have its premiums adjusted to match the actuarial equivalent metal level policy – but if the plan maintains its wider, more-expensive provider network, then it would also have to charge higher premiums than an actuarial equivalent plan with a more narrow, cost-controlled network.</p>
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<p>That’s true for some but not all. I know people whose premiums have gone down, or gone up just a little. Situations vary wildly in different states, and California, where a lot of posters in this thread live, is a particularly high-cost area for health care. And of course if you are one who had a pre-existing condition, but managed somehow to get insurance anyway, your premiums are probably going down.</p>
<p>Also, I think you know this, busdriver, but there has been some confusion in this thread so I’ll remind everyone that if you are fortunate enough to make enough money so that you don’t get subsidized, your premiums don’t go to subsidize the people who get subsidies. So, you aren’t paying higher premiums because others are getting subsidies.</p>
<p>OK CF, found it – I’ve got another one of those really long Federal Register bulletins – this is #78, issued in February 2013: <a href=“http://www.gpo.gov/fdsys/pkg/FR-2013-02-27/pdf/2013-04335.pdf[/url]”>http://www.gpo.gov/fdsys/pkg/FR-2013-02-27/pdf/2013-04335.pdf</a> - go at it. :)</p>
<p>“Also, I think you know this, busdriver, but there has been some confusion in this thread so I’ll remind everyone that if you are fortunate enough to make enough money so that you don’t get subsidized, your premiums don’t go to subsidize the people who get subsidies. So, you aren’t paying higher premiums because others are getting subsidies.”</p>
<p>Yes, I realize it’s that your premiums are going up because now you are forced to have a more comprehensive policy, whether desired or not…and that health insurance premiums just have a tendency to go up. Insurance companies have a captive audience, for the most part. Plus, you are covering all the sicker, more expensive people. I do realize that the subsidies are paid for by the govt, our taxes, not other subscribers.</p>
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<p>So grandfathered plans don’t count in the single risk pool.</p>
<p>But now I don’t understand what is going on with the other plans. Let’s say FangCo insurance offers a bare-bones Bronze plan, a medium Silver plan, and a luxurious Gold plan. Not only does the Gold plan have a higher actuarial value than the Bronze plan, but it also has a broader provider network, including expensive hospitals with gold-plated bedpans. What would it mean to stick the Bronze and the Gold subscribers in the same risk pool? The Gold subscribers would have some risk of incurring those expensive costs at Forest Resort Hospital and Casino, but the Bronze subscribers would not. So how could they be in the same risk pool? The Bronze subscribers aren’t going to be paying for the Gold subscribers to go Forest Resort.</p>
<p>From the Federal Register #78 link I provided above, at p. 13407-13408 (emphasis mine):
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<p>The specific regulation is 45 CFR 147.103 - it sets out all the rating requirements and then ends with:</p>
<p><a href=“g”>quote</a> Applicability date. The provisions of this section apply for plan years (in the individual market, policy years) beginning on or after January 1, 2014. </p>
<p>(h) Grandfathered health plans. This section does not apply to grandfathered health plans in accordance with § 147.140.
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<p>So there IS a statewide rating pool (I’m mistaken about the pool itself being regionalized, although the premium-setting is allowed to consider regional factors) – AND the grandfathered plans are NOT part of that state-wide pool. </p>
<p>But as a general rule of thumb, the smaller the rating pool, the more susceptible it is to premium increases forced by a relatively small number of high-cost individuals. And if the dwindling number of eligible individuals are sticking with grandfathered plans because they have expensive health needs and want to be able to access expensive health care providers that are being excluded from the new plans, that does not bode well for the future of those plans, premium-wise.</p>
<p>Also, this regulation – 45 CFR 156.80:</p>
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<p>CF,to answer your question in post #3811, you want to look at paragraph (d)(2) of section 156.80 (top left of page 13442)</p>
<p>I see. Thanks, calmom. It’s still a bit confusing. FangCo is allowed to consider that the Gold subscribers can go to Forest Resort Hospital and Casino, and charge them more for it. But still, I’m not seeing how the law lets FangCo consider that not only can the Gold subscribers go to Forest Resort Hospital and Casino, but by the very nature of the people who sign up for that expensive plan, they are more likely to be the people who would end up needing health care than the people who sign up for the frugal Bronze plan.</p>
<p>That is, it looks to me like FangCo is supposed to pretend, when doing its actuarial calculations, that the Gold people are just like the Bronze people. FangCo can calculate that Gold subscribers, when they get a gall bladder operation, will be entitled to get the private room with the roulette table down the hall, and charge them more for their premiums, but we can’t calculate that the Gold people are more likely to need the gall bladder operation, and that’s why they signed up for a plan that has a casino in the hospital.</p>
<p>Or maybe, the Gold subscribers are used to having good coverage, have some extra money, and feel more comfortable having a decent plan… even if they rarely use it. It would be hard to decipher why, exactly, people would choose a specific plan.</p>
<p>CF, as far as I can tell, in California, the networks within a given plan don’t vary by metal level. I don’t know if this is an insurance company decision, a federal regulation, or a state regulation. In other words, if GP signs up for Blue Shield or Anthem Platinum plans, he’ll get the same network as he will if he signs up for their Bronze plans. </p>
<p>It doesn’t make a lot of sense to an insurance company to try to maintain a lot of different networks within a given region. It’s enough of a pain to negotiate with providers without having to set a difference based on the plan level. So I’m not sure if you are going to see difference in Bronze v. Platinum when it comes to choice of providers – it would make more sense for a company to just offer both an HMO and PPO (or a straight indemnity plan, which apparently is available in other states). </p>
<p>But as to the risk factors, I think it’s more complicated than what you say. I think that the highest risk group overall are also probably the ones with the lowest socio-economic status, simply because of all the other factors that go into health. And those are the ones who are going to be most likely to opt for the Silver plan with the cost-sharing subsidies. </p>
<p>Outside of the network factor, many people with high health-care usage will do the same math I’ve done – add the premium totals to the maximum out of pocket – and realize that the Platinimum plan costs a lot more than the Bronze for anyone who is likely to top out on annual expenses – so for the more financially secure, the Bronze is a smart move for those with predictable, high health costs. </p>
<p>Maybe down the line they will be able to tease out differences among metal levels, but I’m just not so sure that they will be as straightforward as you suggest. </p>
<p>In any case, the whole point of ACA is that EVERYBODY has to buy insurance, and that high end, catastrophic health care costs can happen to ANYBODY, whatever the risk prediction. So there are going to be healthy people the Bronze plans who are surprised when when they are diagnosed with cancer, or who break their necks in skiing accidents. The idea is that we are all human, we all live together in the same state, and the different plans reflect the choices we each make as to how much we pay into the system – not differential risk. (Except for the tobacco thing, which turns out to be a little more nuanced than I thought).</p>
<p>It might be hard to decipher, but that’s the business of the insurance company so they’d better get it right. But as I read the law, under the ACA FangCo is spared that headache. If they offer different plans with different levels of luxury, they can’t price the plans on the basis of who they think will buy them. Which means they will not offer different plans with different levels of luxury.</p>
<p>But they CAN vary rates by these factors:</p>
<p><a href=“i”>quote</a> The actuarial value and cost-sharing design of the plan. </p>
<p>(ii) The plans provider network, delivery system characteristics, and utilization management practices. </p>
<p>(iii) The benefits provided under the plan that are in addition to the essential health benefits. These additional benefits must be pooled with similar benefits within the single risk pool and the claims experience from those benefits must be utilized to determine rate variations for plans that offer those benefits in addition to essential health benefits.
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<p>So Anthem could offer an off-exchange Platinum plan that specifically includes Cedars Sinai and all the UC hospitals, and includes coverage for all sorts of extra perks – and factor in all of the costs – but the problem is, why would they want to?</p>
<p>If the addition of the perks tends to attract a higher risk pool, the extra premium dollars are probably not enough to offset catastrophic costs – much better for the insurance companies if those high-end users are getting their services from lower cost community health centers. I mean it just doesn’t make economic sense to attract high-risk users to a plan that’s main attraction is the inclusion of significantly more pricey facilities in its networks.</p>
<p>The other issue is the insurance company’s bargaining power: these companies do NOT want to exclude doctors or networks-- they just want to control costs. And they can do that through controlling the insurance market, and directing its insureds to the providers who are willing to accept the low ball reimbursement terms from the insurer. </p>
<p>As more people move onto ACA plans and ACA networks, there will be more pressure for the providers who are holding out to come to terms with the insurance companies – especially in states where only a few insurers dominate the market. </p>
<p>Again, I think we are just seeing a surge in a movement that is going to hit the employer group market as well. It makes no sense for any insurer long term to have different networks for individual & group plans – its confusing for the doctors, its confusing for the patients, and it’s a problem when people shift coverage, as they inevitably will over time whenever they change employment. So I think we are seeing the beginning of a weaning process: in California, Anthem’s trying to squeeze out Sutter-affiliates, and Blue Shield is calling it quits with the UC system – but what is seen in one type of insurance will likely migrate to other categories over time.</p>
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<p>That was my point. The extra premium dollars can’t possibly be enough to offset the higher costs of a higher risk pool; that math can’t possibly work. The insurance company would love to segregate the high-cost users-- but not in a high-cost plan! That’s disaster. </p>
<p>If the insurance company could somehow segregate high-cost users in a plan with inexpensive costs for the kinds of health needs high-cost users incur, that would be to the benefit of the insurance company, but enticing high-cost users into plans with higher health costs is the road to ruin.</p>