I found this post on a little-remarked upon feature of the PPACA very interesting. Apparently, the structures established by the law create a repeating condition of ferment in healthcare plans:
But at least grandfathering cancellations are time-limited; once grandfathered policies are gone, the problem is over. But metallic-tier cancellations will be a permanent fixture, re-emerging every year.
Here’s why: Under the ACA, insurers must restrict individual and small-group policies to four narrow tiers of “actuarial value” (AV) — the average percentage of medical expenses a plan pays. The ranges are bronze (58 to 62 percent), silver (68 to 72 percent), gold (78 to 82 percent), and platinum (88 to 92 percent).
[…]
With narrow tiers, AV drift forces insurers to either cancel policies or undergo considerable effort to push them back into compliance. Adjustments may render policies unprofitable. “Fixing” a plan means a new actuarial analysis and a costly, time-consuming process of submitting the amended plan to state and local officials for approval.
In other words under the law health insurance plans have short shelf lives. For some, this ongoing creation of new plans is a feature of the PPACA. For most people who don’t make picking insurance plans a life’s work it’s likely to become a blamed nuisance.
I do not follow the issue, and I mostly only hear about it from anti-Obamacare sites. I have read that the gaps in percentages between plans are going to cause problems. They were obviously intentional, but I have not read the explanation.
I would love to hate on this thing, but none of the reasons seem reasonable. The healthcare industry did not willing get into bed with the government because they thought they would be put out of business, and now that the government willingly allowed them to get in bed with it, the healthcare industry will control the regulations placed upon it.
As usual, whatever is happening is not what the opponents think is happening.
So PPACA proves to be another Actuary Employment Act. I wonder if they’re still importing them from overseas too?
I pity anybody who participates in any kind of insurance covering himself or his own property, especially the young, male, childfree and healthy who will for years pay for the bad habits and breeding of others.
This appears to be the very thing that happened to us. Despite a willingness to pay the premiums we got a metallurgical cram down. Of course I was probably hallucinating when I commented on this. MR told me this doesn’t happen. So,it must be true.
IMO the ACA’s real impact on people’s health care has been politically incubated by the WH until after the elections –both the 2012 and now the 2014 midterms. This is because many of the mandates and details contained within this law have either been put on hold for a while, or muted by the sheer complexity of it’s verbiage, causing people to not fully understand it’s implications on them, until it slams into their life with unexpected cancellation notices or financial margins impossible to work with.
Last month, for instance, the insurance company carrying my son’s grandfathered-in HC policy sent a cancellation notice, notifying him they would be leaving the state of CA and not renewing his policy… because of Obamacare. Then, during the past couple of days, the only pharmacy closest to our N. CA home, is closing down. The pharmacist gave an interview on a local radio station citing that from 2007, when Medicare D passed, his business has gone into a downward spiral, because of the large reductions in reimbursements from insurers. Before this time his reimbursement of Average Wholesale Price (AWP) was plus 15 percent, with MediCal being plus 5 percent. Now the AWP has gone downward to minus 15 to 17 percent. When Obamacare was implemented things only got worse, including micro-management like language in the PPACA limiting the number of prescriptions that could be filled by smaller pharmacies. According to this pharmacist, after 2 refills the remainder of the prescription had to be filled through mail-order pharmacies — which, BTW, many insurance companies happen to own.
Like so many independently owned businesses, small pharmacies are gradually becoming extinct due to a squeezing out by big government regulations — yielding to super-sized drug stores that can juggle their finances better, have bigger stores to offset the deficits of prescription drugs, along with more impersonal contact with the customer. According to a 2012 University of Iowa study 852 independently-owned rural pharmacies shuttered their doors during an 8 year period of time, across the country. Even where we are, the closest pharmacist is now over 20 miles away, and even he has had his business for sale for over 2 1/2 years, for the very same reasons that our pharmacist has finally called it quits.
Even one of the middle age employees in this pharmacy has nothing good to say about the ACA. She is not only losing her job, but, even though currently insured under Obamacare with a subsidy, her deductible is much higher than the one under her former policy. I now hear these stories everywhere. A subcontractor we work with had his premiums go from $400 a month to $1600!
I just don’t see how the PPACA is benefiting but a very small portion of the populace, at the expense of the majority, who liked their HC before this thing came along.
@jan
… including micro-management like language in the PPACA limiting the number of prescriptions that could be filled by smaller pharmacies. … many insurance companies happen to own. … big government regulations
These are insurance company regulations. All the hair pulling and teeth gnashing over the insurance companies has been for naught. They will do just fine with Obamacare.
As to the people put out of business, they can pull themselves up by their bootstraps. They should pack up and move. They need to stop whining and get a job or two or three. It might have been time to fire a few people, or the person running the place may have been incompetent. Survival of the fittest, and all that.
There are a lot of people who are in circumstances that were not their fault, but they are expected to fix their problem themselves. A lot of people are learning that it can happen to them.
Be careful what you say because what goes around, comes around.
They need to stop whining and get a job or two or three.
Taste, my post was purely an anecdotal one, regarding a vital HC service that will no longer be available by the end of the month, in this isolated, rural area. The pharmacist profiled already runs a scaled-back business — himself and two women employees. For the last couple years he’s been working as a part time pharmacist at a Walmart, 4 1/2 hours away, just to get outside income to subsidize his own business here in town. He’s a good man, has invested all he has to make a go of it, and interacts with his customers in a way that personalizes, educates, and protects those from avoidable drug interactions, misuse, overcharges. He’s not “whining,” only explaining the back story as to why he has no choice but to shutter his business. In the meantime, he says he will recover from this setback, but will not be returning to serve the community as a pharmacist.
IMO, he’s just another casualty of big corporations colluding with big government to over-regulate and effectively stamp out smaller independent businesses. They are then aided and abetted by a naive populace who support the growth and antics of these big impersonal caretakers. Nonetheless, his presence here will be sorely missed, as will other aspects of HC we used to take for granted, such as securing a timely appointment for a health problem. A friend just flew back to MI to help her college-age daughter with an unknown health issue. She called yesterday morning to say, no matter what she did, she could not get an appointment before 2 months for a diagnostic test for her daughter.
And so it goes…..