Thursday, September 17, 2015

Leaving dollars on the table

Most folks are likely aware of the premium credits ("subsidies") available to folks who qualify due to their incomes. These are essentially health insurance "gift cards" redeemable at the insurer of one's choice (well, for certain values of "choice:" plans must be bought on-Exchange to be eligible).

But there's another piece of that subsidy that has apparently gone unnoticed - and underutilized:

"More than 2 million public exchange enrollees eligible for cost-sharing reductions are not receiving the subsides because they selected a non-qualifying plan"

Basically, certain plan designs not only qualify for premium subsidies, but for actual health care expenses to be reimbursed, as well:

"Washington-based Avalere found ... 2.2 million consumers potentially paying more out of pocket than the Affordable Care Act intended because they selected a plan that does not qualify"

And why is that? Well, the consultants blame consumers for looking primarily (perhaps exclusively) at the premiums side of the equation, giving short shrift to the cost-sharing portion.

This is what is known as "bullcrap."

Folks who qualify for premium subsidies by definition are focused on the immediate out-of-pocket cost of the plan itself. If they're willing to potentially eat a $13,000 out-of-pocket for something that may happen (but likely won't), then is it really a surprise that their focus is on the immediate hit to their wallet?

Yeah, didn't think so.
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