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health insurance

Affordable Health Care Is No Where In Sight


Don't be fooled. After finally agreeing to pay the August Affordable Care Act (aka Obamacare) cost sharing reduction (CSR) payments to insurers, Trump and corrupt Secretary of Health & Human Services, Tom Price, remain committed to destroying Obamacare. Their goals are to pay less in subsidies that help people purchase individual health insurance plans and pay for medical care, and to scare health insurers away from the exchanges by injecting uncertainty about future subsidy payments.

Unfortunately, and despite the latest CSR payment, Trump and Price's sinister plot to undermine Obamacare is having the intended effect. Because health insurers cannot be certain that this Administration will not stall or stop future subsidy payments, they will increase rates by a higher percentage than they otherwise would have. And when health insurers feel uncertain and are afraid they won't meet their financial objectives, they take it out on everyone. That means health insurance premiums may be higher for everyone next year, even employer-sponsored group health plans.

But that is not all on Trump and Price. Their childish, mean-spirited antics only highlight a fundamental problem with a for-profit, private sector led health insurance industry. You see, American health insurers have always insisted that their profits be assured. Taking a loss in one line of business (selling to individuals) and making it up in another line (employer-sponsored and other group insurance), but still making an overall profit, is viewed as a loss for them. They want all of their lines of business to be profitable all of the time.

Even if Trump and Price admit that the Republican health care reform efforts have failed, that they will now honestly administer the Obamacare law as intended, and promise to make all future CSR payments on time, insurers will still raise rates higher than are needed until they feel comfortable that their profits will continue. How long will they wait until they are comfortable that their profits are not in imminent danger? They will wait as long as they want to, which is forever, and there is nothing we can do about it.

Health Insurers Will Always Inflate Premiums

It is so disingenuous for Obamacare critics to imply that the health insurance market was ok or even better before Obamacare. How they ignore or explain away that purchasing individual health insurance pre-Obamacare was hit or miss or that finding comprehensive and affordable coverage was impossible is beyond my comprehension.

Purchasing individual health insurance pre-Obamacare was a long and difficult experience. First, you had to find a reputable insurer that sold individual plans, and then you had to work with an insurance broker to apply and purchase the policy because you couldn't work directly with the insurer. And that describes the not too bad parts of that old way of purchasing insurance. The fact that tens of millions could not purchase individual health insurance, some because they didn't want to, but many because they were denied or couldn't afford it, tells you everything you need to know about why Obamacare or something like it was bound to happen.
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Health Care Reform Protestors Continue To Ignore Employment-Based Coverage


Some people think the original sin of health care and health insurance is government regulation and "patches" like Medicare and Medicaid. Other people think the problem originated from a different government sin—the employer health care tax exclusion. This tax break translates into significant money saved for individuals enrolled in employer-provided health plans. Individuals not enrolled in these plans and who purchase health insurance, do not receive these savings.

So which sin should the country address first, health insurance regulations and patches or health insurance costs equity? The easiest issue to address—equalizing or eliminating the special tax treatment of employer-sponsored health insurance plan payments is a good place to start. But our time-strapped Republican-majority Congress decided to spend the majority of its limited attention tinkering with the political and policy challenges of health care regulations. The Congressional health care reform bill, the
American Health Care Act (AHCA), does not equalize or eliminate the employer health care tax exclusion but goes very far in changing health insurance regulations.

These proposed regulatory changes will take hundreds of millions of federal dollars out of the health insurance and health care system if they survive the Senate and reconciliation processes and are signed by the President. Potentially,
tens of millions may lose their health insurance coverage and access to health care. People opposed to the AHCA are focusing their energies on protesting at congressional town halls, emailing and writing their representatives and educating the public about its possible impact. It's an uphill battle for these protestors to change the course of legislation, which is why I think they may have more luck at addressing the unequal tax treatment of health insurance premiums that exists between employer-sponsored and individually paid private health insurance.

The AHCA, in a very limited way, does address the employer health care tax exclusion by providing tax credits to individuals that purchase health insurance. However, these credits may not equal the value of the exclusion and the health plans available in the individual market do not equal what employers offer. So, at a minimum, protesters should demand that the AHCA equalize the tax treatment of all health insurance plans. But they shouldn't stop there. AHCA opponents may have more success trying to convince employers to stop providing health insurance or provide only supplemental health insurance.
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The Battle Between The "I Was Helped/Hurt By Obamacare" Snowflakes


Since the presidential election, Trump supporters and non-supporters have accused one another of being Snowflakes, or overly sensitive. However, recently the term Snowflake is used increasingly to describe Trump supporters. Countless articles in liberal and conservative media publications warn about the dangers of referring to all Trump supporters as racists, misogynists or uninformed. They claim that these negative characterizations are starting to backfire and result in Trump supporters clinging to him even more.

And many Trump voters admit that they are completely turned off by liberal attacks and hurtful characterizations. Not surprisingly, Trump non-supporters refuse to alter their depiction of Trump voters. They find their characterization of Trump voters accurate and their feelings not worth protecting given the potential harm a Trump Administration can cause. Add to this war of words the contentious issue of affordable health insurance and health care, and you get a mini battle between people that claim Obamacare helped them versus people who claim it hurt them. Both camps have its share of Snowflakes with the "Help" combatants referring to the "Hurt" combatants as selfish and heartless, and the "Hurt" section referring to the "Help" warriors as smug.

The "Hurt" group desperately wants to explain its objections to government-mandated health insurance. They don't like being forced to pay higher premiums than they otherwise would to subsidize health insurance for people who can't afford it. Some in this group don't want to subsidize anyone's insurance but most object to subsidizing people they characterize as able-bodied adults who made bad life decisions. A typical social media thread between the two groups has traces of the culture war happening between Republicans and Democrats.

(This is a real, abbreviated thread from a health care Facebook group. I purposefully exclude the name of the group and the contributors):
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Health Insurance Illiteracy Is An American Problem



The Onion, a news satire organization known for fooling many journalists with it’s made up stories, has a hilarious story in its October 5, 2016, edition about a man who woke from a coma and suddenly understood his health insurance policy. And like most of The Onion headlines and stories, it's really funny because there is some underlining truth to the satire.

According to about a dozen annually produced surveys, Americans don't understand their health insurance. A UnitedHealthcare “Consumer Sentiment Survey,"
cited by BenefitsPro revealed that "just 7 percent have a full understanding of all four basic insurance concepts: plan premium, deductible, coinsurance, and out-of-pocket maximum." Despite decades of employer and insurer-provided communications, the majority of Americans can't explain what a deductible is or how it works. Not understanding their health insurance policy is an American problem because insurance isn't as confusing in other countries.

We just returned from vacationing in Russia and Finland. In our travels from Moscow to Uglich to Yaroslavl to St. Petersburg to Helsinki we met a lot of people. And despite their economic status, level of education, or age, everyone we spoke to about health insurance understood their health insurance plan coverage. They understand their health insurance because it's simple. No deductibles or coinsurance or out-of-pocket maximums.

Many Americans do not want government-sponsored health insurance but they do want health insurance they can understand. But is easy-to-understand health insurance possible in America in the age of high-deductible health plans, referencing pricing and tax-saving accounts? As an employee benefits professional, it is easy to blame health insurance illiteracy on lazy employees who refuse to read plan information, but that would be ignoring the fact that these plans are often so complex that few people can claim to fully understand them.
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