When it comes to the cost of Obamacare in Montana, if all you do is read the mainstream news outlets, you may not be getting an accurate portrayal of the true cost of the Obamacare exchanges.
A new report in the Columbia Journalism Review skewers the numbers from a recent report in Montana:
He (the AP) told readers that a 30-year-old could buy plans costing between $200 and $300 a month. That’s true, as far as it goes, and quite a bargain as insurance premiums go. Such prices may well entice young men in particular to sign up. But the report failed to tell a more complete story and misled readers about a crucial point in buying insurance that could end up costing them big bucks if they get sick. Gouras reported “rates vary with various copays and deductibles.” Well, yes, but there’s more to the story, as we’ve been pointing out. His problem: confusing copays with coinsurance—two very different animals. And in so doing he left coinsurance out of the story. Yet coinsurance is becoming a major factor in calculating what you get when you buy insurance. High coinsurance could lead to a nasty surprise when the bills arrive.
To review: A copay is a fixed amount a person pays for a service, such as $75 for a visit to a specialist or an urgent care clinic. Copays used to be the cost-sharing method of choice, and patients got used to paying what were often nominal amounts for services. Times have changed. In the last year or so insurers have switched to coinsurance, which is a percentage of a bill that the patient must pay. Coinsurance results in much higher out-of-pocket costs. For example, if a policy calls for a $75 copay on a $500 outpatient procedure, the patient would simply pay $75. If it calls for a 30 percent coinsurance for a that procedure, the patient would pay $150. Confusing these two terms is a common mistake that patients—and reporters—make, but it’s dangerous because it misleads people into thinking their policy covers more than it does, and this can result in nasty—and—expensive surprises.
As I’ve mentioned on our statewide radio talk show recently, you should be wary of any numbers being thrown out there by government agencies charged with promoting Obamacare. A public radio station in California took the bait, and aired a story claiming that Obamacare rate hikes would be nothing like critics predicted. Then, someone double checked the numbers- including Daniel Kessler, a professor of business and law at Stanford University.
Here’s an excerpt from his op-ed in The Wall Street Journal:
Exchange plans also involve much more cost-sharing than the typical plan. For example, the deductible of an individual “silver” plan—the benchmark for determining the subsidies for low- and moderate-income people—in the California exchange is $2,000, considerably higher than the $1,250 minimum deductible for a High-Deductible Health Plan that qualifies for a Health Savings Account under current federal law. (The deductible for a “bronze,” or budget, plan is $5,000.)
This apples-to-apples assessment shows how much higher exchange-plan premiums will be. For example, a 25-year-old male who lives in San Francisco can purchase a “California 40/4000” policy from Kaiser today that has a $40 copayment for office visits after a $4,000 deductible, with a $5,600 out-of-pocket maximum, for $140 per month. Kaiser’s most comparable exchange policy—a “bronze” plan with the minimum benefits and the highest out-of-pocket costs—has a $5,000 deductible with a $6,400 out-of-pocket maximum, although it allows three office visits per year that are exempt from the deductible. It costs $227, 62% higher than its current comparable plan, the California 40/4000.
Comments
Al Smith
Monday, August 26, 2013 4:13 PM
It still amazes me to fix a problem a small percentage of folks had in securing health insurance, we were all saddled with a confusing, costly, and less efficient system to be run by government bureaucrats.
What Obamacare will cost our people and the nation, estimated now at some two trillion dollars, private insurance coverage could have been purchased for everyone who could not afford it on their own.
To say the American people were outright lied to by the president and his minions (here you say: Senator Max Baucus, Nancy Pelosi and Harry Reid)in order to make sure this abomination became law is fairly harsh. In spite of hating to say we were lied to in that many words I hereby say it: WE WERE LIED TO!
If Obamacare is not defunded it will not only cause tremendous damage to the very best health care the world has ever known, it will become the costliest, most ineffective system ever devised to provide health services.
Doctors are already seeing increased workloads caused by those bureaucratic rules and regulations already imposed. They don’t like it, my own doctor is one who wants to practice medicine, not deal with never ending government paperwork. Many doctors are voting with their feet and headed for the exits through early retirement. Fewer doctors means longer waits to get needed care.
I’ve maintained from the git-go that Obamacare is not about healthcare at all. It is about controlling the American population by the use of a convoluted set of laws, rules, and regulations. Your personal life from cradle to grave, if this law is implemented, will be totally in the hands of government bureaucrats.
Those of you who voted for hope and change better tune up your hope because change is here and it is not for the better!
Walter Morris
Tuesday, August 27, 2013 1:23 AM
Al, you are absolutely right and are only saying what the opponents of this debacle have said from the start of this misguided plan. We were told that we wouldn’t understand it until it took affect. A lot of us understood it and if we don’t get it defunded and let it go into action, our country will be broke before we can get the damage stopped. Anybody that can’t understand the terrible expense of this all and the bad disarray of our health care it will cause just doesn’t want to understand and is only trying to make excuses for the fact that they were lied to and fooled completely. Come on folks stand up and admit you were wrong and save this country while there is still a chance.