4 ways Obamacare has improved the insurance you get through work—and without driving up premiums
March 03, 2017 | By: Andy Carter
Obamacare (officially, the Affordable Care Act) gave a big helping hand to one in 12 Pennsylvanians who now have health insurance because of the law. But if you are one of the majority of Pennsylvanians who get coverage through your job, the Affordable Care Act has helped you too.
What’s more, price increases for this “new and improved” employer-sponsored health insurance have, on average, actually slowed since the Affordable Care Act was signed into law.
Four ways your employer-sponsored health insurance is better now
- “Free” preventive care. Under the Affordable Care Act, most insurance plans—including, most likely, yours at work—must cover a host of preventive and wellness health care services at no cost to you, the consumer.
The list includes annual checkups, depression and cancer screenings, and other health care services that doctors and medical experts agree can help you stay healthy. Think of it this way: your baseline routine care for the year is included, free of charge, in your health insurance.
- Immediate coverage for pre-existing conditions—no wait period. So you’re starting a new job? With the Affordable Care Act, when your employer-sponsored health insurance kicks in, so does coverage for any chronic disease or other health condition that you had before you started the job.
Before the Affordable Care Act, some insurance plans had delays of up to a year before plans would cover health care services for pre-existing conditions like cancer, heart disease, and diabetes. As a result, you could find yourself either skipping care or paying out of pocket until the waiting period was up—even though, technically, you had insurance.
- The care you need. Before the Affordable Care Act, some employer-sponsored health plans had dollar amount limits on your health care benefits. Limits could be annual (limiting how much health care would be covered during the year) or lifetime (limiting how much would be covered during the life your policy). Once you hit the limit, you were on your own. You had to pay for any needed health care out of your own pocket or go without.
The Affordable Care Act eliminates these annual and lifetime limits.
- A cap on your annual out-of-pocket expenses. For most employer-sponsored insurance plans, the Affordable Care Act also puts an absolute limit on the amount you can be expected to pay for health care out of your own pocket during any given year.
For 2017, the out-of-pocket limit is $6,850 for an individual plan, and $13,700 for a family plan. That’s a lot of money. But you know it’s the most you can be expected to pay, even if you or a family member gets a serious cancer diagnosis.
For many employers, premium increases are moderate…
So all these consumer protections must have driven up premium costs, right?
For many employers, the answer is happily “no.”
In Pennsylvania, the average health insurance premium paid by employers on behalf of their employees has increased by about 5 percent a year since the Affordable Care Act (2010–2015). That’s much less than the 7.3 percent annual growth during the previous decade.
If you have recently seen changes in your employer-sponsored insurance, please understand that the health plans your employer offers can change for many reasons, such as when:
- Employees, as a group, use more health care services than usual
- Your employer works with insurers to introduce innovations, such as high deductibles and health savings accounts, designed to engage you in health care decision-making and hold down insurance costs
…But individual premiums spiked for 2017
We do have a problem with the what’s called the “individual” insurance market. This is insurance that individual consumers and families purchase for themselves:
- At HealthCare.gov, the Health Insurance Marketplace, or
- Directly from insurers or through insurance brokers, outside of the marketplace
In Pennsylvania, the 2017 premium increases approved for the individual market jumped, on average, 32.5 percent.
Based on national trends, only about half of consumers who purchase insurance “individually” will actually feel that hike in their wallets. Thanks to the Affordable Care Act, consumers who enroll through the marketplace, and who fall below certain income levels, receive help in the form of advance credits on their federal income taxes.
Most (75%) of these marketplace enrollees are expected to be able to find insurance for less than $100 a month.
Still, those Pennsylvanians whose incomes are too high to qualify for financial help, and who are unable to get insurance through employers, likely will face premium increases during 2017.
The Trump Administration recently acknowledged the importance of the Health Insurance Marketplace and the need to stabilize it. Recently proposed regulations offer first steps to address this issue.
Repeal? Only with a replacement that repairs and improves!
In recent discussions about health care policy, President Trump noted, “I have to tell you, it’s an unbelievably complex subject. Nobody knew that health care could be so complicated.”
If you are still with me in this rather long blog, I bet you agree.
Can the Affordable Care Act be improved? Yes, clearly it needs to be.
But I urge lawmakers to tread carefully and thoughtfully as they consider adjustments to the many moving parts that make up the Affordable Care Act. We must be on the look out for unintended consequences as well as better solutions.
Above all, let’s wait to repeal until we thoroughly understand the replacement.
Let’s be sure we get something that’s better than what we have now.