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Bob Laszewski's blogpost today discusses how the plans under the new Affordable Care Act were built and whether or not people will actually purchase them. I have had discussions about this with my clients, as to what they will decide to do at the end of 2014, when they will no longer be able to hang on to their 2013 style insurance plans any longer.
Many of these people are self-employed, and do not qualify for any type of subsidy. Most of them are relatively healthy, and have always carried health insurance on their own. And yes, it was "real" insurance - not sub-standard coverage. When the time comes for them to choose an ACA style plan next year for coverage to take effect in the year 2015, they are going to find that their premiums without a subsidy will double in many cases. The reason for that is that all of the current plans include all of the "essential health benefits" that the government built into every health plan, whether you deem it essential or not.
That is not to say that plans previously didn't have their problems - access to maternity coverage was a huge problem in the individual market. Often, it was not even offered as an option. But, maybe they could have found a solution like having every insurance company offer a maternity "option", that people who wanted the coverage could purchase - rather than build it into every plan. Same for things like pediatric dental. There were many other ways to have offered these benefits to people rather than baking them into every plan.
As an individual in the marketplace, I should have the right to purchase a catastrophic plan if I so choose, but that right was also taken from me, in the government's zeal to have everyone own a plan that looked very much like employer based plans look and feel. Well, that's great, if you have an employer either paying for the plan, or kicking in 50% or more. For those of us who are self employed, or work in places where no health insurance is offered, buying a Cadillac is just not a feasible proposition.
Keep in mind too, that the self employed also pay the maximum amount already on things like social security contributions and Medicare contributions in the form of self-employment tax, since they don't have an employer kicking in a portion of that. Read Bob's Blogpost Here . . . .
