April 16, 2014

Obamacare and Me

 

Obamacare and Me

Full disclosure: I’m an Obamacare supporter. That’s why I’m writing this in the first person—more of an essay than an article. I’m not objective. I’ve been through insurance-healthcare hell and lived to tell. Some of the people in the stories I’m going to share understandably didn’t want their names printed, but I promise: these are real-live people right here in Topanga whom I know personally. You probably do, too.

Aside from a few blissful stints when my employer provided my health insurance, I’ve been buying individual health insurance for most of my adult life. I was as nervous as the next guy about the Affordable Care Act (ACA), aka Obamacare. Having been the veteran of a catastrophic claim, I knew exactly what I was looking for in a policy and I was pretty happy with my Anthem policy. Then I got my cancellation letter and, well, panicked.

The first thing I did was to go online to shop alternatives at Anthem, Kaiser, HealthNet, etc. Yikes! Everyone was right! There weren’t many with similar coverage that I, a 51-year old, single, self-employed female, could afford. I lamented to my friends that while I totally supported the ACA, it looked like Obamacare was gonna burn me after all. Dammit!

However, rather than relying on political rhetoric (from both sides) and the hysteria surrounding the October 1 launch of Obamacare (from both sides), I did some research.

TRUTH, MYTHS, LIES, PANIC

The first thing to understand is that the ACA only affects about 11 million (four percent) Americans: those of us who buy individual policies and those who have no health insurance at all (according to the U.S. Census Bureau).

If you are covered by your employer, Medicare, Medicaid or Medi-Cal or your state’s equivalent (about 308 million of you), Obamacare doesn’t affect you and you don’t have to do anything.

We’ve all read and seen the horror stories about how policies are being canceled and people are being forced to buy more expensive policies that have huge deductibles and exorbitant monthly premiums that will surely bankrupt them.

Here’s something I read on Facebook—don’t laugh, this is where many people are actually getting their information. It’s ridiculous and absurd…but someone actually “shared” it so this is the kind of junk that’s out there as “fact”:

I received an email tonight at 5 p.m. informing me that my fine would be $4,037 and could be attached to my yearly income tax return. Then you make it to the "REPERCUSSIONS PORTION" for "non-payment" of yearly fine. First, your drivers license will be suspended until paid and if you go 24 consecutive months with "’Non-Payment" and you happen to be a home-owner, you will have a federal tax lien placed on your home. You can agree to give your bank information so that they can easy "Automatically withdraw" your "penalties" weekly, bi-weekly or monthly! This by no means is "Free" or even "Affordable.”

I’m not going to attribute this, but I’ll be happy to send you the link if you’d like to see more from this gentleman.

OK…BACK TO REALITY

In 2014, the actual penalty for not having health insurance will be the greater of 1.0% of taxable income or $95 per adult and $47.50 per child (up to $285 per family). There are lots of exemptions. I’m sure you can find one. (source: https://www.ehealthinsurance.com/affordable-care-act/faqs/how-much-are-the-tax-penalties-for-not-having-health-insurance-and-when-do-they-apply)

The next thing to understand is the reason why these policies are being canceled: they don’t comply with the new stricter standards of the ACA.

The fact is some health insurance on the market today is just lousy.

That's a big reason why even people who have insurance can go bankrupt when their medical bills start piling up. Health insurance you bought for yourself before might have seemed perfectly okay, but there's a good chance it had big holes in it, the kind people tend to only find out about when they incur expensive doctor and hospital bills. (Source: http://www.huffingtonpost.com/2013/11/01/health-insurance-cancellations_n_4192079.html)

This was most definitely my personal experience when I battled health insurance companies during my son’s three-year battle with cancer.

The new policies must include an essential health benefits package that covers the following general categories of services:

• Ambulatory patient services

• Emergency services

• Hospitalization

• Maternity and newborn care

• Mental health and substance abuse disorder services, including behavioral health treatment

• Prescription drugs

• Rehabilitative and habilitative services and devices

• Laboratory services

• Preventive and wellness services and chronic disease management

• Pediatric services, including oral and vision care (Source: http://www.naic.org/documents/committees_b_Exchanges.pdf)

BUT WAIT! THERE’S MORE!

• No one can be excluded because they have a pre-existing condition.

• No one can be canceled because they get sick. In fact, they are required to renew your policy each year.

• You are no longer compelled to stay with your current policy because you’ve been red-flagged due to a chronic or pre-existing condition. This means you can switch policies or providers if you’re unhappy—even if you’re sick, have a pre-ex, are pregnant…the list goes on. As things are now, they can raise your premium as high as they want and you can’t get any other coverage if you have a pre-existing condition because no one will take you.

• You can no longer be excluded or canceled because of your age or gender.

In fact, according to Micah Weinberg, a senior researcher at the Bay Area Council Economic Institute in San Francisco, "A lot of the anecdotes about people having policies canceled and gigantic increases are real but not representative of what's happening more broadly in the marketplace." He predicts many people who are losing their policies will come out ahead—even if their premiums go up— because of lower deductibles, full coverage of preventive care and no penalties for pre-existing conditions. What's more, he says, health insurance will almost certainly be cheaper for those who qualify for subsidies—in California, that's an estimated 1.9 million people. (Source: http://www.pbs.org/newshour/rundown/2013/11/health-plan-cancellations-are-welcome-for-some-californians.html)

So, not surprisingly, the majority of existing individual policies had to be canceled.Simply stated, however, it is true. The premiums are more expensive and this is where the politicians like to end the horror stories and wax poetic on the higher premiums. But here’s what they leave out:

• I found that based upon my income, I qualified for a subsidy which substantially reduces my monthly premium. This surprised me. I thought I made too much money. The number you should use for income is line 38 if you filed a 1040; line 21 if you filed 1040A; or line 4 if you filed 1040EZ. You should estimate what your 2014 income will be for application purposes. I doubled my 2012 number just in case, and I still qualified for the subsidy. ­­­­­

If you underestimate your income, a balance due will be added to your tax return. If you overestimate your income, you will receive a refund on your tax return.

• Even though the total premium (without the subsidy) is higher, the coverage is superior and over the course of the year will cost me less. Especially if I get sick.

• I have received my policy documents and have paid my first month’s premium for coverage effective January 1, 2014. Here are my actual numbers:

Old Premium: $346/month

New Premium: $82.16/month

Old Deductible: $4,500

New Deductible $ 500

Old Annual Maximum Out-of-Pocket: $9,000

New Annual Maximum Out-of-Pocket: $2,250

Old Rx: I paid 100% of my $100/month prescription (it counted toward the deductible)

New Rx $5 co-pay

• The insurance companies offer the same policies directly, but they cannot offer the subsidies. The subsidies are only available if you buy the policy through coveredca.com (or your state’s exchange or healthcare.gov).

• I want to repeat that last one again because it’s important and I haven’t seen much reporting on it: Insurance companies cannot offer the subsidies…only the government-sponsored exchanges can. So if you’re getting your information from the insurance companies directly, they may not tell you that you may be able to get the exact same thing cheaper through the exchanges.

HERE’S HOW IT WORKS

Go to coveredca.com and click on "Start Here," then "Preview Plans," and answer the four questions. You do not have to enter any other personal information unless you choose to apply. Even then, there are no health-related questions other than those that determine your usage of healthcare services (not the reasons for the usage). You will see the amount (if any) of premium assistance you qualify for and a suggested list of policies. The lower premium policies have higher costs; the higher premium policies have lower costs. You are free to purchase any policy. Editor's Note: After press time, Lundi noted that the process was a little different as the exchanges continue to update and needs change for coveredca.com as well as for healthcare.gov.

Excited about my own results, I went through this process with a good Topanga friend. His four answers were very different from mine. He has a heart condition, therefore, more doctor visits and prescriptions. He’s older. He makes more money than me. Yet he still qualified for premium assistance and the coverage is far superior to that of the catastrophic plan he has now. The suggested Platinum plan for him increases his current premium by about $50...but now his co-pay to see a specialist is $40; labs are $20; diagnostic imaging is $40; drug co-pays range from $5to $25. There is no deductible (you read that right) and his annual out-of-pocket is $4,928.

Local Snyder-Sutton realtor Stefanie Becker lost her health insurance when her premium was received one day late and her policy was canceled. She was already having trouble finding replacement insurance due to a pre-existing condition when she found out she was pregnant. She had to go on Medi-Cal and was seven months pregnant before she could see a doctor. In the meantime, her husband, Bernard Penzias’s premium increased drastically when he turned 50. He also has a pre-existing condition, so they were put in the position of having to decide whether or not to even keep his health insurance.

ENTER OBAMCARE

Under their new HealthNet HMO, the whole family is fully covered, and they are saving more than $500 a month. Their deductible and annual out-of-pocket is substantially lower.

Another self-employed Topangan with pre-existing conditions bought his HealthNet policy years ago for around $200 a month. Over the years, he has watched his premiums increase annually. He currently pays more than $1,600 monthly. (Yes, you read that right.) Until now, he could never shop different policies or companies because he’d either be rejected outright or have his pre-existing conditions excluded. Even though he doesn’t qualify for any subsidies, the most expensive Obamacare policy out there will save him about $1,000 a month and, again, the coverage is superior, which will save him even more. His long-time doctors participate in the plan he chose.

I chose a Silver-level HealthNet policy. I searched online through more than 1,000 doctors to choose my primary care doctor (I didn't have one before). As required, I called HealthNet to let them know my choice and pay my first month's premium. Then I called my newly selected doctor, a board-certified female internist 4.2 miles away and made an appointment for January 10 for the first physical I've had in years. It will cost me $15, and maybe another $15 for labs.

And I’m pretty sure this is how it is supposed to work.