Subsidy surprises and other ACA nonsense

by Marc Landry, News and Observer, October 9, 2013.

President Obama said that if you liked your health insurance plan, nothing would change under the Affordable Care Act. Based on reports of skyrocketing premiums, the president must have had his fingers crossed behind his back when he said those words.

The “losers” include people who were already doing the right thing by buying individual health insurance policies and who are now discovering that their plans are no longer being sold. Replacements often are much more expensive.

As with too many of our laws, the ACA punishes the prudent and rewards the improvident.

I have had my own encounter with the ACA and now realize that any optimism I might have had was misplaced. I am uninsured and considered a “free rider” by some in positions of authority.

While other websites have had problems, the BCBS website worked very well, and I discovered there were 24 policies available to me with monthly premiums ranging from $545 to $1026. The policies offer a wide range of premiums, deductibles, co-pays, networks, HSA eligibility, co-insurance options, drug benefits and out-of-pocket limits, among other variables.

Even if you could borrow the NSA’s super computer to crunch the numbers, it is impossible to make an informed decision on which policy to buy as none of us knows what our medical needs are going to be in 2014. Shoppers might consider using a crystal ball or a Ouija board.

The website does have a feature that allows you to answer a few simple questions so that BCBS will recommend three plans most likely to meet your needs. My recommended plans cost between $585 and $706 a month.

My medical expenses average about $1,000 a year, so the opportunity to spend $7,000 or more in premiums for policies that have deductibles of $2,800 or $5,000 does not make much financial sense.

Prescription drugs that now cost me $4 for a month’s supply would have co-pays of $10 or $25 if I had insurance. Not much of a benefit that.

Health insurance companies have armies of doctors, lawyers, risk assessors, actuaries, statisticians, underwriters and other experts who are most adept at devising policies that extract the maximum amount of premium from their customers and pay as little of their clients’ medical expenses as possible. Those policies are approved by our government, and elected representatives have had the “benefit” of education and enlightenment from legions of lobbyists representing hospitals, doctors, health insurers and drug makers.

The health care of those who are required by law to purchase these policies is far from the top of the list of important concerns among those who devise and approve the policies and most definitely comes way after the financial interests of the health care and health insurance industries.

I am a substitute teacher in Wake County schools. I expected to qualify for a subsidy. The ACA defines “affordable” as costing no more than 9.5 percent of one’s income. I would have to work 900 days a year for 9.5 percent of my income to buy me coverage.

No such luck.

I have fallen into what is called the “Family Glitch,” which everyone accepts was a drafting error in the ACA.

As its name implies, the ACA was intended to make “affordable” health insurance available to all Americans. However, if your spouse has benefits at work, the ACA requires that coverage be affordable only to the employee and does not mandate affordability for the rest of the family. Oops.

I am ineligible for any subsidy, no matter how low my income, even though coverage from my wife’s employer would cost more than many policies I can get from BCBS.

Given the climate in Washington, pigs will fly before Congress would approve a correction to this oversight.

The bottom line is that the ACA requires me to buy an “unaffordable” product that would do little to pay for my medical expenses.

I have previously described Obamacare as a pipeline from the U.S. Treasury to the coffers of the health insurance and care industries. We now discover that a spur of that pipeline will extend to the wallets of millions of Americans.

We listened and trusted Nancy Pelosi and passed the ACA, and we continue to discover what is in it.

Surprise.