Agree or Disagree? New Study: Even Subsidized Job-Based Health Insurance Has Become Unaffordable

[bwinters]

None of that changes the outrageous premiums for health insurance for them.

The challenge for churches too, at least in my area, is that people work for the church forever so it's an aging population. Pastors and "the church lady" might work well past Medicare-eligibility and stay on the church's health plan, and the church doesn't want to push these low-paid staff off the health plan because of age. At least we have a solution for high cost of those Medicare eligible employees with a group-Medicare MSA. We're finding that for those small groups it can be a financial saving grace (no pun intended)

When I first went on a QHDHP, my family deductible was $1200 and OOPM was $2500. Those days are long past.

 

[somarco]

Most MAPD plans are low or no deductible with a small or $0.00 premium.

Perhaps in your area, but there is another world beyond the state lines.

In my area $0 premium plans are prevalent but about a third of the plans have premiums of $15 - $92. Copay ranges from $0 to $300 or so, and OOP range from $5k to $10k. And many providers are non-par for some of the plans which can be a problem when you need something other than primary care.

Changing hats, there is a $0 premium PDP which is great for folks who have minimal Rx needs . . . but it can really suck if you need an expensive med.

Sometimes the lowest price is not your friend when it comes to health care.

 

[LeeV]

I agree, it's becoming unaffordable. Just had a conversation with a church yesterday (16 FTE). I used to handle their group insurance. They hired a guy to handle all the day to day business and he decided to move them to a PEO type situation. Evidently this past year they all went through the Marketplace and got individual policies and the church is now paying about $14k per month on those plans. I ran a traditional group plan and the lowest premium was about $35k per month. I then looked at self-insured plans and we can get it down to about $12-13k per month. I may end up with the business, but that's a chunk of change for any business, especially a church.

If I wanted a plan for me and my wife, with say a $5,000 deductible and a MOOP of $16k, it would only cost me a little over $25k per year. So in a worst case scenario I'd "only" have to spend $41k for the year. Asinine. Even the highest deductible plan would be over $17k per year. With an $18k MOOP. We go to the doctor maybe 4-6 times per year combined.

It has become unaffordable for many. ACA was the Cloward-Piven Strategy (as it relates to healthcare) and nobody can convince me otherwise. Overload the system, make it so terrible that government then has to come in and "save the day". It's the precursor to universal healthcare.

No offense intended, but the cost savings you've outlined do seem quite extraordinary. (I have been doing self-funded medical for over 40 years) For a group of 16 to receive a quote of $35k per month for a Fully Insured plan and then only $14k per month for a Self-Funded option is indeed remarkable and gives me some reason for pause. This would equate to a total cost of $900 per month per contract, which is quite significant. If you told me that the $14k was the fixed cost, that would be more in line with expectations.

Would you mind sharing more details about the self-funded quote, such as how it is structured, the vendors, etc.?

 

[sman]

The challenge for churches too, at least in my area, is that people work for the church forever so it's an aging population. Pastors and "the church lady" might work well past Medicare-eligibility and stay on the church's health plan, and the church doesn't want to push these low-paid staff off the health plan because of age. At least we have a solution for high cost of those Medicare eligible employees with a group-Medicare MSA. We're finding that for those small groups it can be a financial saving grace (no pun intended)

When I first went on a QHDHP, my family deductible was $1200 and OOPM was $2500. Those days are long past.

Fortunately the oldest person is mid-50's. Most everybody is in the 20-something to 40-something range.

 

[sman]

No offense intended, but the cost savings you've outlined do seem quite extraordinary. (I have been doing self-funded medical for over 40 years) For a group of 16 to receive a quote of $35k per month for a Fully Insured plan and then only $14k per month for a Self-Funded option is indeed remarkable and gives me some reason for pause. This would equate to a total cost of $900 per month per contract, which is quite significant. If you told me that the $14k was the fixed cost, that would be more in line with expectations.

Would you mind sharing more details about the self-funded quote, such as how it is structured, the vendors, etc.?

The carrier is Allstate Benefits. I normally use Aetna for the self-funded plans, but they don't do churches. Even my Allstate rep was surprised at the low rates. And this is AFTER they submitted applications with health history. Meaning the rates are higher than the initial quote. The pastor wants an HSA plan. It has a $6,250 deductible ($12,500 family and 100% thereafter). He and the wife are 55 and two adult children not age 26 yet. Their rate for that plan is $1,339.18. The other employees are likely to choose a $5,000 deductible plan with a $40/$60 copay for PCP/Specialist. The rates are as follows:

EE - $440.82
EC - $859.59
ES - $1,124.08
EF - $1,454.69

These plans have Aetna Choice POS II as the network.

This carrier also has reference based pricing which is a lower cost option. Some of the ES and EF include a husband and wife who are both employed by the church, but overall there are 16 employees who will be covered.

Lastly, the $14k is what the church pays and does not include the 20% the employees pay. But overall, the premium for those two plans would result in a full premium of $15,538.23. Still much less than a fully insured plan.

 

[LeeV]

The carrier is Allstate Benefits. I normally use Aetna for the self-funded plans, but they don't do churches. Even my Allstate rep was surprised at the low rates. And this is AFTER they submitted applications with health history. Meaning the rates are higher than the initial quote. The pastor wants an HSA plan. It has a $6,250 deductible ($12,500 family and 100% thereafter). He and the wife are 55 and two adult children not age 26 yet. Their rate for that plan is $1,339.18. The other employees are likely to choose a $5,000 deductible plan with a $40/$60 copay for PCP/Specialist. The rates are as follows:

EE - $440.82
EC - $859.59
ES - $1,124.08
EF - $1,454.69

These plans have Aetna Choice POS II as the network.

This carrier also has reference based pricing which is a lower cost option. Some of the ES and EF include a husband and wife who are both employed by the church, but overall there are 16 employees who will be covered.

Lastly, the $14k is what the church pays and does not include the 20% the employees pay. But overall, the premium for those two plans would result in a full premium of $15,538.23. Still much less than a fully insured plan.

Thanks

 

[annon123]

Fortunately the oldest person is mid-50's. Most everybody is in the 20-something to 40-something range.

The catch with self funded with a small number of people is that if someone has something expensive happen they are screwed. Cancer can do it and I got cancer three times younger than mid 50's, the first one at 40. The gamble is no one is going to have something expensive happen in such a small group. Self funded with a large number of people helps the risk pool. Churches usually don't have a huge endowment so make sure they carefully think through worst case, can they afford it. Even the much larger than you are talking about self funded employer I was with was very unhappy.

 

[LeeV]

The catch with self funded with a small number of people is that if someone has something expensive happen they are screwed. Cancer can do it and I got cancer three times younger than mid 50's, the first one at 40. The gamble is no one is going to have something expensive happen in such a small group. Self funded with a large number of people helps the risk pool. Churches usually don't have a huge endowment so make sure they carefully think through worst case, can they afford it. Even the much larger than you are talking about self funded employer I was with was very unhappy.

Annon123, you're right to emphasize the risks involved with self-funded plans, especially for smaller groups. It's often a gamble on whether major, costly health events—like cancer or other critical conditions—occur within the risk pool. However, in this scenario, there are a few guardrails in place to mitigate the risk to an acceptable level.

The first is the use of a level-funded plan, with advance and accommodation. This will provide the employer with a fixed, max cost for the plan year. This assumes the enrollment remains high enough to avoid a cash call due to falling below the minimum attachment point.

The second is the possible use of a Spec, which I believe Allstate utilizes in their plans. But even if they do not, the group is of such a small size that it usually does not matter.

Third, the Allstate LF plan would offer relief via their pooling.

Fourth and last, even if the plan went sideways at renewal, the group could move back into fully insured.

 

[annon123]

Annon123, you're right to emphasize the risks involved with self-funded plans, especially for smaller groups. It's often a gamble on whether major, costly health events—like cancer or other critical conditions—occur within the risk pool. However, in this scenario, there are a few guardrails in place to mitigate the risk to an acceptable level.

The first is the use of a level-funded plan, with advance and accommodation. This will provide the employer with a fixed, max cost for the plan year. This assumes the enrollment remains high enough to avoid a cash call due to falling below the minimum attachment point.

The second is the possible use of a Spec, which I believe Allstate utilizes in their plans. But even if they do not, the group is of such a small size that it usually does not matter.

Third, the Allstate LF plan would offer relief via their pooling.

Fourth and last, even if the plan went sideways at renewal, the group could move back into fully insured.

Thank you for that information. Glad to hear there are some safety nets. I only work in medicare and so am far less familiar with what you do other than having been insured myself in the past by several self insured employers. After two cancers in one year with treatment spilling into a second my self insured employer let me go - especially when I was told why. This is an "at will" state though meaning that not renewing someone's contract for otherwise "illegal" reasons is legal if you do at contract renewal even if they know why. It would have been illegal had they terminated me effective the day before my contract was to renew (they told me it was because of what I had "done" to insurance costs).

 

[sman]

The catch with self funded with a small number of people is that if someone has something expensive happen they are screwed. Cancer can do it and I got cancer three times younger than mid 50's, the first one at 40. The gamble is no one is going to have something expensive happen in such a small group. Self funded with a large number of people helps the risk pool. Churches usually don't have a huge endowment so make sure they carefully think through worst case, can they afford it. Even the much larger than you are talking about self funded employer I was with was very unhappy.

Not to be rude, but you aren't fully informed in this case. I think @LeeV answered it pretty well so I won't elaborate further.