Health Care’s Impact: Big Bills for Many

RIO GRANDE – Like the wake of a speeding boat the Affordable Care Act’s impact on local wallets may take time. From one insurance broker’s perspective much of that impact remains unknown, because larger companies and their employees will not feel the jolt until after Jan. 1, 2015.
The broker, who asked that his name not be used, told the Herald he has seen cases where affordability under Affordable Care, has vanished. That is due to the new rating structure mandated by the law, he said.
“One big thing for small business plans is they no longer take the average age composite rating. They are doing each person individually, and each person pays a different rate based upon their age. You have some younger people who benefit, but older people are hit by some huge rate increases as a result,” he said.
Those unable to keep their plans can shop around, he said, and noted that one he knew went from paying $400 monthly to $900 a month.
“What some are doing, depending on their income, they go to the exchanges. They may possibly qualify for tax credits to help pay the premiums. But, people who are over the income brackets to qualify are forced to pay astronomical rates or face going without coverage,” he added.
“They are basically the choices,” he noted.
Such cases he cited included some casino workers who lost their jobs, and find themselves in the netherworld of the unemployed but needing health insurance, and having made too much money to qualify for anything considered affordable. Such persons have a “choice,” he said, but shook his head as he uttered the word.
“The other thing, people who drop their (health) insurance are forced to pay a fine of 1 percent of their income when they file their income tax. It’s cheaper than buying insurance, but if they need medical care, they face high costs there, too,” he noted.
“We, in the insurance industry, are anxious to see how the ACA will impact large firms (classified as having 100 or more employees),” he continued. Because the start date is Jan. 1, some firms are still deciding how to address the situation.
Small groups of 51 to 99 “do not have to comply until 2016,” he added.
The inaction of Congress did not miss his concern. “There have been multiple bills passed in the (Republican-controlled) House to make changes, but none of those bills were brought to a vote in the (Democratic-controlled) Senate,” he said.
The “biggest problem is taking a half socialized system and a half capitalist system,” he noted. “Some pay less and some pay significantly more. It needs to be one way or the other,” he said.
From the medical side of the equation, the broker said he is “seeing a lot of small (many solo) practitioners joining large doctors’ groups because it is unaffordable for them to deal with ACA and smaller payments.” Payments to them under ACA are less than other insurance firms, and some physicians cannot cover expenses under the new act.
“It’s a really tough thing seeing people struggling to pay for health insurance. It was expensive enough before, but to see the cost for people to have insurance, it’s increased so much that it impacts a lot of people. The new plans are basically offering less coverage, out-of-pocket payments are higher, and they have to pay up-front deductibles they did not have before,” he said.
“The whole purpose of ACA was to insure 40 million people. There were 8 million who got coverage through exchanges in the nation. Three to 4 million already had coverage that was cancelled as a result of the ACA, so the result after the first year insured was 4 million new people,” he said. “So what did you really accomplish?” he asked.