Obama's health law will be judged on 3 questions: Premiums, choice, consumer experience

By Ricardo Alonso-Zaldivar

Associated Press

Published: Saturday, July 6 2013 9:25 a.m. MDT

"The benefit design is going to be richer than what is typically purchased and available today ... and the rules require insurers to sell a policy to whoever wants it, regardless of health status," she said.

That still doesn't get you to the bottom line because most consumers will be eligible for income-based tax credits to help pay premiums. The plan they pick also could make a big difference.

Jeremy Gilchrist, a self-employed meteorologist from Winooski, Vt., has been uninsured about four years. In his mid-30s, he's in good health, and he says he can't afford premiums on a skimpy budget.

"For most people, it's going to be a financial decision," Gilchrist said.

According to the online Kaiser Family Foundation's health reform subsidy calculator, Gilchrist would be eligible for a tax credit of nearly $2000 on a standard "silver" policy that costs $3,000, leaving him with $1,000 to pay.

But he can also take that $2,000 tax credit and use it to buy a cheaper policy called a "bronze" plan, leaving him with only about $500 to pay annually. The bronze plan meets the new requirement that virtually all people in the United States have health insurance. But if you get seriously sick or injured you'll wind up paying more out of your own pocket.

Still, the premium would come to $42 a month for Gilchrist. "The bronze plan would be lower than my car insurance," he said.

But wait.

If Gilchrist were a smoker, which he is not, the law would allow insurers to tack on a penalty of up to 50 percent of the premium.

With time, the decisions of millions of individual consumers will reveal a true bottom line.

CHOICE

The typical Medicare recipient has about 30 private insurance plans from which to choose. There may not be nearly as much choice for families and individuals under the health care law. How much that will matter remains to be seen.

It's partly because in most states a single insurance company currently controls more than half the market for individual coverage.

The administration says that's going to change for the better. In three-quarters of the markets the federal government will run, there will be at least one new insurer.

But areas of concern are emerging. New Hampshire could end up with just one insurance company offering plans through the new marketplace. In 36 of Mississippi's 82 counties, no insurer has yet signed up to offer coverage. Bigger states, however, don't seem to be having problems attracting insurers.

"The individual market for 2014 will look a lot like the individual market today — one or a handful of carriers dominant in most states," said Larry Levitt, a leading expert with the nonpartisan Kaiser Family Foundation.

But people will be able to move more easily from insurer to insurer, he added, which should bring more competitive pressure.

CONSUMER EXPERIENCE

For people without job-based coverage, shopping for insurance under the new system is supposed to be as smooth as using a major online site such as Travelocity or Expedia.

But in a recent report, the Government Accountability Office raised concerns about the sheer technological complexity of the task and the short time left to accomplish it.

The goal is for consumers to be able to find out the amount of the tax credit they're entitled to and sign up for a plan in real time or close to it. For that to happen, the computer systems of several major federal agencies, the states and dozens of insurance companies have to be able to talk each other, and the information exchanged must be accurate.

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