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

[annon123]

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.

Correct and I thanked him for the additional information since I don't work in employee insurance.

I do know that human nature, for most part, is not to think the worst will happen and gamble that it won't. Hopefully the church will have a comfortable budget for if the worst does happen. I know I lost my job over 'costing them too much'... And yes, as was pointed out, they knew the max they would be in for but clearly weren't expecting to hit anywhere near that and so dumped me to keep future costs down.

 

[EckoRomeo]

I only work in medicare

You're an agent?!?

Thought you were "not an agent" like the other guy.

 

[annon123]

You're an agent?!?

Thought you were "not an agent" like the other guy.

I am a pretty new agent entering this later in life. I am still learning (well actually I suspect many experienced people still learn things on occasion but I am not very experienced yet and so still am encountering some/many things for the first time).

 

[me112233]

EGH is making coverage "affordable" with higher deductibles & OOP while simultaneously making it unaffordable to get sick or injured.

Obamacare does the same thing. Highly subsidized premiums make the fixed costs affordable but limited networks, higher deductibles & OOP scares folks from seeking care . . . or if they do get care, they are left with expensive, unpaid medical bills.

The same is true about MA plans.

No, the same is not true about MA plans. The deductible is non-existent on most plans, and the out-of-pocket costs rarely reach the limit, which is commonly $6,000 of less. Most people on MA plans coast through the year paying less in medical bills than they used to pay in Medicare Supplement premiums. For those who were once going with "Medicare only", the MA is a close approximation to what they would have otherwise, except there is an out-of-pocket limit with an MA plan, whereas there is no out-of-pocket limit for those on just plain Medicare. While MA plans certainly have their warts, saying things that just aren't true doesn't help the discussion.

 

[annon123]

No, the same is not true about MA plans. The deductible is non-existent on most plans, and the out-of-pocket costs rarely reach the limit, which is commonly $6,000 of less. Most people on MA plans coast through the year paying less in medical bills than they used to pay in Medicare Supplement premiums. For those who were once going with "Medicare only", the MA is a close approximation to what they would have otherwise, except there is an out-of-pocket limit with an MA plan, whereas there is no out-of-pocket limit for those on just plain Medicare. While MA plans certainly have their warts, saying things that just aren't true doesn't help the discussion.

With respect to MA plans vs OM's plus supp and total MOOP costs: In this state (so likely state specific) it is very possible to have OM +supp (ignoring D since we have a $0 plan and the identical D rules) together cost less, often far less than the lowest MAP plan's max MOOP. Even for the oldest of the elderly in this state with one G it still costs less than all but one of the MA MOOP's (and in that case the two are very close).

In my opinion what is "best" is about the risk level an individual is willing to accept and pay for if they guess wrong. If they guess wrong and need a lot of care then let's hope they are on OM with a supp that together will cost them less than a MA's MOOP which in this state is true for all of them (see very elderly above for the one exception) or have enough money paying for that level of care with a MA is not a hardship.

And, of course, some miss getting extra help and can't financially deal with either situation so in any case needing much in the way of health care is unaffordable. I see this as a big problem (affordable care) with many in this country, not just 65+.

 

[LostDollar]

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.

I don't understand the other options you mentioned, but I saw one of my old employers do the fourth option with our plan.

I was not privy to reasons, but they were on a self funded program for two years, and then they switched back to something where they paid full premiums. I have always suspected one or two covered people got very sick that last year on self funding.

 

[somarco]

the risk level an individual is willing to accept and pay for

Sick folks weigh that into consideration when choosing a plan. It is rare (my personal experience) to find many T65 that think much beyond "I have never been sick" unless they have a close family member that went through rough times.

Too often folks look at MA offerings, and (maybe) check providers, but often say plan X has all my CURRENT (my emphasis) doctors.

OK, but how about docs you may need in the future?

Sometimes that gives them pause, sometimes not.

My home has never caught fire or had a loss due to weather . . . doesn't mean it won't ever happen . . .

 

[LeeV]

I don't understand the other options you mentioned, but I saw one of my old employers do the fourth option with our plan.

I was not privy to reasons, but they were on a self funded program for two years, and then they switched back to something where they paid full premiums. I have always suspected one or two covered people got very sick that last year on self funding.

LostDollar, those were not options; rather, they (1-3) were features of the self-funded plan that was being discussed. They were being discussed in response to someone stating that self-funding was dangerous. They show that the level-funded plan does have protections/guardrails. The 4th is not a feature of level-funding but rather a strategy to use when the self-funded plan becomes too expensive due to risk. When this happens, the group we were discussing could easily transition into a fully insured contract.

 

[Robduq23]

This is all trickling into a funnel for universal healthcare. No it's not a great fix but that's what the government is going to label it. We know the government has never given anything that is great. Their solutions are bare bones and made to kick the can down the street for the next generation to worry about. Sell other things.

 

[annon123]

Sick folks weigh that into consideration when choosing a plan. It is rare (my personal experience) to find many T65 that think much beyond "I have never been sick" unless they have a close family member that went through rough times.

Too often folks look at MA offerings, and (maybe) check providers, but often say plan X has all my CURRENT (my emphasis) doctors.

OK, but how about docs you may need in the future?

Sometimes that gives them pause, sometimes not.

My home has never caught fire or had a loss due to weather . . . doesn't mean it won't ever happen . . .

That is so true.

Also psych research shows that, on average, people underestimate the odds of bad things happening to them. The Lake Wobegon effect - everyone is above average. On average they also have trouble projecting what life will be like for them in the future. That doesn't help with thinking ahead. Sigh.