Rex and Cheri have the answers. Listen here.
Insurance Talk — Learn About the Affordable Care Act
Cheri Martinen: You’re listening to Insurance Talk with Cheri Martinen and Rex Lesueur. We’re the father-daughter team from Bancorp Insurance located in beautiful Central Oregon. We are here today to talk about health insurance. We’ve talked about Medicare now for it seems like forever.
Rex Lesueur – Yeah, we had a whole show on group health.
Individual Health Care
CM – But we left out a huge group of the population and that’s individual health care.
RL – And it has changed an incredible amount since I first got into the business years and years ago. When I first started selling health insurance, it was pretty simple and now it’s gotten a little bit more complicated. Let’s rephrase that. It’s a lot more complicated. Well, the biggest change has been the affordable care act. Well, whether you love it, whether you hate it, it is the law of the land. It has done some remarkable things. It has pissed off a lot of people.
CM – It is what it is and it is and it’s what we have today. So that’s kind of what we’re going to be talking about.
RL – Your knowledge about it, if you’re going to have to interact with it is important because there are so many facets to it and there are so many different things that you need to know how to make it work for you. If you’re in a situation where you do need to buy individual health insurance and roughly about 8% of the populace out there do – you’re going to have to rely on individual health insurance. They don’t have a group where they work. They may not work. They don’t have Medicare or Medicaid. And so that leaves that particular part of the population that are going to have to deal with the ACA, or this part of the ACA, in order to get health insurance.
CM – And a lot of people in, so the ACA Affordable Care Act will, we’ll probably shorten it as ACA because we do in our industry. A lot of people call it Obamacare. So if that’s how you recognize it, it might be Obamacare. The law was brought into effect in March 2010 and it had three primary goals. It was to make affordable healthcare insurance available to more people, which sounds pretty good. It was to expand the Medicaid program to cover all adults with incomes lower than 138% of the federal poverty level, which again, that sounds like a good goal. And then the third goal was to support innovative medical care delivery methods designed to lower the cost of healthcare generally. And again, that sounds like a pretty good goal. I don’t know if it’s hit all of these goals, but they’re very good goals.
RL – Yeah. The third one is probably the one they haven’t actually been as successful as they would have liked.
CM – Yeah, I would agree. I was going to say the first two, they’ve done some, they met those pretty quickly I think.
RL – And then the other, well, one of the things they did with that third one was they actually created and help fund probably a couple of hundred alternative style health insurance companies. There were two in Oregon that they funded. Both have gone broke and they went broke real quick.
Remember Cover Oregon?
CM – Yeah. And in Oregon, we originally had Cover Oregon. I think a few people remember the beautiful banners and neat ads that were on TV. We shouldn’t get the jingle out. I was thinking about it today.
RL – It was a great jingle, a matter of fact. The only thing that worked on Cover Oregon was the jingle.
CM – Yeah, they did great marketing, unfortunately on our end. Um, and I think on a lot of users and the state just wasn’t ready to take that many enrollees on.
RL – The computer system that they spent $100 million on that was supposed to be just as whizzbang, you know, go on there, type your name in, you know, blah, blah, blah. You know, 15 minutes later you got insurance. Never worked.
CM – Yeah. And so there was a lot of paper applications and paper applications you had to fax because of federal regulations and fax machines were breaking. And I think there was some poor person that was on the other end of that fax machine at the state just pulling their hair out, trying to keep it full of paper.
RL – I am sure that person is still going through counseling because I am. I can remember taking paper applications and sending them in and following up and they wouldn’t. And it was, yeah, this is all supposed to start January 1 and April, they’re still messing with it.
CM – Which is why now we go to www.healthcare.gov at this point in time, it’s the federal site. Oregon gave up and they said, well, Cover Oregon didn’t work well. RL- Yeah. So let’s just use the federal government site. It at least worked adequately and it has improved since that original first year.
CM – And I mean the state of Oregon does pay the federal government to use their website. But like we said, it’s better than the Cover Oregon fiasco is terrible. If you’ve ever been on the website and you hate it, just remember Cover Oregon. One of the other things of the Affordable Healthcare Act, and I think people, they think, well we’ve always had this but we haven’t, preexisting health conditions was a huge thing that it brought us. And you could talk about the old days of health insurance more than I can, but we used to ask health underwriting questions.
Pre-Existing Conditions and Preventative Care
RL – People used to walk into my office and say they want health insurance. And I said, have you been to the doctor in the last five years? And if they said yes, I said, was it for anything serious? And if they said yes, I would say, we can’t buy health insurance. No insurance company will accept you.
CM – So that’s one, I will say, that’s a really, really big deal, especially for individuals who maybe just found out they have cancer or something like that. They can get the health insurance they need and during the open enrollment period, I should say.
RL – Find somebody that’s over 50 that that doesn’t have aching joints or something, some small blood pressure medication or maybe they’re not height to weight proportional. We have no customers that are overweight. They’re just not tall enough. That’s correct for how much they weigh.
CM – ACA did give us a few good things and we were just talking about the preexisting conditions.
RL – That was one of the key factors in what the coverage was. Every insurance company before that really had the option of making a decision as to whether they would cover a preexisting condition or not. And most did not cover a preexisting condition period. If you had something that hangnail they would say, Oh, we’re not going to cover your finger.
CM – Pregnancy was with that preexisting condition, too. Which I think back in the day, if you told them you’re pregnant, they would just tell you to go away.
RL – Well, they actually, you had the option of buying maternity leave or not buying maternity coverage. And so what that meant was that if you were of childbearing age and you wanted to buy it, they wouldn’t sell it to you because obviously you’re only buying it because you’re thinking of having children. And that would make no sense that they would sell you insurance for something that you might want to have. And so a lot of babies were born without health insurance. Well actually, the preexisting condition clause also applied to children. You had to ask if the child could be put on the policy. So if you had a child with a disability, you couldn’t put it on the policy if the company wouldn’t allow it. So there was, it was pretty draconian.
CM – Another one that they added that we are at least allowed to do now that we have the ACA is the free preventative care, which I always think is a good thing. Go and get your knees knocked, let the doc look down your throat.
RL – Yeah, maybe get a colonoscopy, maybe have your prostate checked, you know all these things that make women’s exams, women’s health exams. Yes. All of these things should be something that we as a society and make sure that everybody has access to and those weren’t covered before.
CM – And so it is nice to have those on the ACA plans. One of their goals was to give young adults more covered options. Before it was kind of like, well I know now we have like the catastrophic coverage, but young adults, as you said, maybe didn’t have as many options because they were at risk.
RL – Well, they were at risk of starting a family. God, what a terrible risk.
CM – They tried to make it a little bit easier to understand what you were getting. I think they did an okay job at that. My day is filled with helping individuals read the plans and still understand what it is. So I don’t know how easy it really is.
Health Care Standardization
RL – Well, one of the things that they did do, which I think is really important was they gave us a little bit of standardization in the plans. Before the ACA, there was no such thing as the bronze, silver, gold and platinum plans. There was just plan A and plan B and every company had a plan A and plan B or maybe a plan C. it was almost impossible to compare the plans from one plan to another based on the fact that they hit so many different provisions. There was no standardization. It was incredibly confusing.
CM – I will say that their plan compared tool online isn’t too bad. You know, they give you the basics, they’re going to give you the price of the plan. They’re going to give you the deductible, the maximum out of pocket right up on the top. They’re going to give that right at the top and then they help compare with different costs that you might associate. Such as when you go to the doctor, how much is your copay going to be, if you go to a specialist, how much is your copay going to be? What’s a copay for an urgent care visit versus an emergency room visit versus an overnight at the hospital or lab work or other things that we might have to use. And they do put them all side-by-side.
RL – And that is something that a consumer can work with. An educated consumer is a really desirous thing to have when you’re purchasing something as complicated and as important as health insurance.
CM – So that is one good thing about the ACA. Thanks, ACA. It made it a little bit easier. They gave us a few other things — mental health was a big one that they added.
RL – Why shouldn’t mental health not be covered? I mean, you know, it’s about your health. It’s part, it’s part of your body. Part of the whole package. Before that was excluded. So these are the kinds of things that they started putting into the ACA. It wasn’t optional for the insurance company to say, we’re not going to cover that.
CM – They said it has to be kind of similar to pediatric dental. They said kids need dental, you’ve got a kid on this plan. They’re going to have dental. It’s mandatory.
Healthcare Open Enrollment
CM – One of the things we help our customers with is health insurance. And I should start this off, I haven’t said it yet. Health insurance open enrollment, it’s November 1st to December 15th and you better get on it if you want to have health insurance. That’s it. That’s all the time you get. You get six weeks.
RL – Yeah, and if you don’t sign up, then you have to wait a year to get it. Yeah,
CM – November 1st to December 15th, that’s it. That’s all you got. Unless you have a special enrollment and maybe we can talk about that now. Special enrollments are going to be if you move to a new county or you move into the state for the first time. Another special enrollment would be if you’re pregnant, that’s a special enrollment. You can get enrolled in health insurance. Another special enrollment is that you lose coverage from no fault of your own. So we see this one throughout the year as maybe you’re on OHP and you get a raise at work. Yay. Now you’re no longer eligible for OHP. As soon as you get that letter, that cancellation letter that says you’re no longer eligible, you come and see us, we’ll get you health insurance. It’s okay, don’t panic, don’t panic. Or you are on an employer plan and maybe you moved to a new employer and that employer doesn’t offer health insurance. That’s another reason that you can have a special enrollment period and you can enroll throughout the year.
RL – We were also going to talk about in this segment, we were going to talk about the fact that the health plans now have something called a maximum out of pocket. So what does that mean? That means exactly what it sounds. Actually it’s one of those phrases we use that actually makes sense. So we like to shorten it to MOP. Maximum out of pocket. How do you get the maximum out of pocket? Well, first you have your deductible and the deductible is something that all insurance health insurance policies have. And as a part of the first part of any care that you get, that you have to pay for yourself.
CM – We kind of hinted on this earlier, Rex, we talked about having the bronze, silver, and then gold plans and the deductibles are kind of based on maybe what you would pay for the price. So if it’s a lower-priced plan, maybe a bronze plan, your deductible might be higher or it would be higher. And most of the time for the bronze plans, the deductible is the same amount of money that your maximum out of pocket is.
RL – I’m on a bronze plan and my deductible is close to $7,000. The insurance company isn’t going to pay any part of any care that I have unless it’s preventative for the first $7,000 and then you reach your maximum out of pocket, which means you stop paying and they pay 100% after that. Which, okay, that hurts. But if I’m looking at it from a catastrophe point of view, if I had to pay $7,000, I could come up with that. You may have to make payments. But I could come up with that. But if I had a $100,000 bill, I certainly couldn’t come up with that.
CM – That’s where the whole point of having health insurance is, right? Because one event could easily reach the $100,000 mark.
RL – Yeah, we’re talking a couple of days in the ICU and you’re at $100,000 plus.
CM – So having that bronze plan, a lot of people say, well, why would I even want to purchase this, that get, you know, blah, blah, blah. It’s not good coverage. And yeah, it’s not great for that little stuff, but something really bad happened that catastrophic event that we kind of talked about. It could be a vehicle accident on Highway 97 or a skiing accident or anything, a heart attack or a gallbladder operation, you know, a real bad slip and fall.
RL – So how do you get to the maximum out of pocket? Well, there’s two things. There’s one, there’s a deductible, and then there are copays.
CM – Now on the bronze plan, you’re not going to see a lot of copays though. Almost none, but let’s talk about the silver plans. Let’s bump it up. And that’s where we get to see a lot more of the copays. You’ve got the deductible, which, okay, $2,000, might be $4,000. That’s what you’re going to pay first before the insurance company pays anything. And then we have co-insurance, and we’ve kind of talked about this in other areas, but that’s the amount that you pay. And then there’s what the company pays for a particular service, right?
RL – Sometimes it’s 70/30, sometimes it’s 80/20, sometimes it’s 90/10. The insurance company pays 90% you pay 10% and I’d say on the silver plans, most of the time it’s 30/70.
CM – So you pay 30% and the insurance company pays 70% and you share that cost until you reach that maximum out of pocket. Now there are exceptions to this, and those exceptions are those copays that we kind of talked about. And those are normally for the more regularly used items like your preferred providers. So you just go to the doctor because you got a really nasty cold and you’re like, I think I need help. That one, normally there’s a copay and so that’s going to be $25 or $45 to go see your doctor and a lot of times they’ll take it at the counter when you go see the doctor and then they have one for specialist. Specialists are going to be things like your podiatrist, your cardiologist. They’re going to be the more specialized doctor and that copays a little bit higher and that one can go anywhere between $45 or $75 depending on what plan you’re on. And then they have a few more, not all the time, but a lot of times urgent care, urgent care normally has a copay and I always suggest going to urgent care first because the copay is a lot less than the emergency room copay.
RL – If the guys at urgent care are available, go to urgent care first, unless you’re bleeding profusely. If you’re just bleeding a little bit, you can go to urgent care.
CM – It’s going to save you a lot on your pocketbook before emergency rooms. And then the other copay, we see a lot as sometimes lab work or x-rays, and that’s just because that’s something that we use all the time. So deductibles are a big part of them.
Contact Bancorp Insurance for Your Health Insurance Needs
If you want to know more about it, call us 1-800-452-6826 we’d be happy to sit down with you in person or over the phone to help you with all your health insurance needs.