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I'm still clueless as to why the lowest cost plans are twice the premium I'm paying today, on top of having higher deductibles. You'd figure that (a) it's so much cheaper because of some policy change and should have been cancelled, or (b) it's so much cheaper that they should have cancelled it to force me to pay twice as much. * 29, non-smoker, Pennsylvania * PPO through Aetna * $3000 annual deductible / max out-of-pocket * 0% coinsurance, no annual coverage limit * $90 per month premium, up from $85 when I first signed up, yet I got a rebate check back last year for part of it Essentially the same plan from the same insurer, but with a $6350 deductible instead of $3000, is now ~$200/month if I were to sign up today. |
The key to your question are the terms "guaranteed issue" and "age bracketing." I'm going to guess that you're pretty young and at least at the time that you enrolled in your health insurance, you'd never had any health problems. They way that individual health insurance worked prior to 2014, insurance companies would offer extremely low rates to individuals, and keep their expenses down by refusing to insure anyone with even the most dubious "pre-existing condition." So if you'd gone to the doctor complaining about a pain in your side, that would be considered a disqualifying event, and they'd turn you down. Or, much worse, you'd get the insurance, pay premiums for years, then if you ever developed cancer, they'd later comb through your health records, find where your doctor wrote down that you'd had a pain in your side, cite it as an undisclosed medical issue, and refuse to cover your cancer treatment.
Needless to say, that's a very effective way of keeping the cost of coverage down: only insure healthy people who never go to the doctor. As you aged, the insurance company would start jacking up your rates to cover their increased exposure. If you ever developed an illness, you'd have no choice but to pay what they asked, because you wouldn't be able to get insurance from another company since you now had a pre-existing condition.
Healthcare reform's two boldest and most popular changes are guaranteed issue (health plans must accept you, regardless of pre-existing conditions) and outlawing "recission," or retroactively searching for disqualifying health records to deny claims. So what that means is that insurance companies can't cherry-pick the healthy people anymore, which means that the young, healthy minority is going to see higher prices for individual health plans.
Second, the ACA reduced the number of allowable age brackets, meaning that plans for the oldest people can only cost 3x what the youngest people pay. So that hits younger people again, since they have to be roped in with an older age contingent than before.
You may have heard Obamacare proponents worrying about getting enough young people into the risk pool so we don't end up with "adverse selection." They're not worried about that just because young people are feckless and think they're invincible. It's also because they know that they're the ones that are seeing the biggest rate hikes. Of course, while someone like you have to pay $200/mo instead of $90, the flipside is that a family that used to be unable to afford $1500 per month and can now be insured for $250, and that seems like a decent tradeoff, especially since, in general, young people will eventually get older and have families themselves, and they'll benefit from the changes.
The good news is that at least for the time being, you'll still have cheaper insurance, until your insurance company starts with the shenanigans and starts jacking up your rates or discontinues that line (and blames it on Obamacare whether it's true or not).
And by the way, if anyone out there is involved in a business that's having a hard time with health benefits costs, my startup is taking advantages of lesser-known provisions of the new healthcare law to save companies a lot of money. Let me know and I'll hook you up with the details. We're called Benefitter.