There’s no such thing as an “Obamacare” health plan

Some blame “Obamacare” for pretty much everything; high insurance costs, increasing deductibles, access issues (real and imagined), narrow networks with fewer physicians, hospital closures, global warming (oh, wait, no such thing).

And worst of all, this is all due to the “Obamacare health plan”.

Which is kinda weird as there’s no such thing.

Outside of Medicaid and Medicare, there is no governmental health plan option available anywhere. None.  Yet I’ve heard from doctors’ office staff (who really should know better), folks in the health care industry, and lots of the “people on the street” who attribute everything bad about health insurance, coverage, cost, bureaucracy to Obamacare.

Facts…

  1. All health plans are offered by commercial insurers and health plans.  Anthem, Blues plans, United Healthcare, Aetna, Humana, you name it – all are independent, private insurers.
  2. These health plans design their own insurance offerings, market them to the public and employers, balancing access and cost, coverage and deductibles, benefits against market demand.  Yes, there are tight definitions about core benefits that must be covered: this is so consumers’ health needs are addressed, not excluded by some fine print buried deep in a Summary Plan Description.
  3. Health plans alone determine what doctors are in-network, deductibles and copays, premiums and physician reimbursement. Not the feds or the Exchanges, but each insurer/health plan.
  4. Health care costs are going up (in some places by a lot, in others not so much) because of factors like:
    1. too much crappy medicine,
    2. a reimbursement system that pays docs too much for doing stuff to patients and not enough for talking with those same patients,
    3. over-utilization of some health care services,
    4. an aging population,
    5. obesity and other lifestyle factors,
    6. outrageous prices for some drugs (driven by for-profit pharma)
    7. a large uninsured population that forces health care providers to charge insured patients more to cover their costs of treating those without coverage (we’re talking about you, Texas, and you, Florida, and Kansas and Mississippi and Alabama and Wisconsin and…)
    8. stupid benefit design that relies way too much on deductibles and nowhere near enough on coinsurance (where members pay a percentage of the cost for each service, thereby exposing them to the real cost of services)
    9. a completely disjointed and dysfunctional health care non-system with prices much higher than any other industrialized country and outcomes mostly worse.

As Donald Rumsfeld said, “you’ve got to go to war with the Army you’ve got.”  Much as I despise Rumsfeld, he was unfairly pilloried for that very perceptive comment.  The reality is simple – “Obamacare” was, and is, an attempt to broaden coverage and allow the private market to figure out how to improve care and reduce costs.

Yes, there are a lot of regulations about how insurers have to do that; given the insurance industry’s financial motivation to avoid insuring sick people and actually pay claims it is no surprise that the regulators are trying to protect consumers from big insurers and their legions of lawyers.

Is this ugly and are there stupid regulations and are costs going up way too much in some areas and is it all way too complex and confusing?

Oh yeah.

What did we expect when reforming an industry that is responsible for one out of every six dollars of our economy? And was failing miserably at delivering good care at a sustainable cost?

Hell, we can’t even prevent trains from crashing, or fund a bill to fix our crumbling infrastructure, or reform our amazingly nutty income tax system, or stop doctors from making millions dispensing drugs to work comp patients.

We are well on the way to fixing one of the biggest problems in our country, And we’re “disappointed” in health care reform?

Really?

What does this mean for you?

It is, indeed, a clustermess.  

Some people will get hurt.  Some companies will fail,  Some will get fabulously rich.  Some will go to jail.  But in the end, more will have insurance, insurers will compete on a relatively level playing field, and incentives will be more aligned with what we consumers want – better health at low cost.

9 thoughts on “There’s no such thing as an “Obamacare” health plan

  1. Generally agree but suggest that you do not attribute enough of the issue to providers – hospitals, doctors, drug manufacturers, etc. – and attribute too much to insurers. For instance you suggest the insurance industry controls provider networks – and actually providers have a good deal of influence over networks. Providers clearly use the desire of consumers and regulators to have bigger networks against insurers in negotiations to drive up reimbursements.

  2. Just a few observations: 1) Regarding “Obamacare”, after Blue Cross sent me a new card last year that said “EPO” instead of “PPO”, I was turned away by one of my doctors whose receptionist said “we don’t take Obamacare”. There’s a lot of fury (and several lawsuits) among Blue Cross customers over the PPO/EPO confusion that has yet to be fully explained. 2) Regarding high cost of drugs, I was prescribed an antibiotic that cost $1,200 for a one month’s supply. After my insurance co-pay it still cost $600 out of pocket. Astonishing. 3) I agree with the previous commenter regarding provider networks. It is my doctors, not Blue Cross, who keep choosing to drop out of my network. I’ve had many instances where doctors are listed on the Blue Cross provider network who then send me a bill for the full amount because they’d dropped out without telling me, despite still appearing on the BC website. This is a huge problem for patients stuck in the middle of these fights. I see more doctors in L.A. converting their businesses to “concierge medicine” charging several thousand dollars a year for the privilege of seeing them. Is that the future of health care? From my experience, I’d say the ACA is a vast improvement, but there’s still a long way to go and a whole new set of problems to fix.

    • Hi-
      I, along with many of my colleagues have been listed illegally by insurance companies as providers for some of the Obamacare Plans. Only difficult is….none of us signed up. Certain payers may be doing this to present a false, complete “narrow network” to the Department of Managed Healthcare. So while there may be some patient confusion in this case, it’s hard to pin it on the healthcare practitioners.

  3. While there is technically no such thing as an Obamacare Plan, tell that to the 30% of my patients who were kicked off their affordable health plan, which they specifically tailored to their own needs. Most reported being forced to sign up for a much more expensive plan with benefits they will never need, and with a HUGE deductible that did not provide access to their doctor (or physical therapist). Their access to healthcare is far worse than before Obamacare passed.

    This is what you get when inexperienced politicians and policy makers craft a plan to fulfill their own legacies without examining or even reading the policy. As the House Speaker said, “We have to pass the bill before we can read it.”

    And with all the money spent on their failed website and marketing they could paid for the free insurance for most of the uncovered people.

    The narrow networks are a complete disaster in CA, which has been acknowledged by our Democratic state legislators and the Insurance Commissioner. But Obama needed to get the payers on board with Obamacare in order to pass the legislation. That’s why there are so many loopholes, workarounds and giveaways to the payers. Many of them are now reporting near record profits.

    And that’s why I believe so many call it Obamacare……

    Having said that, I’m still waiting for someone to suggest a better alternative plan.

    • Paul
      Thanks for the comment.
      Your patients are mislabeling their health plans. Health insurers have the freedom to design plans within the benefit structure of the Affordable Care Act. The patients’ issue is not with “obamacare” as that is a mythical beast formed in the canny marketing minds of the President’s enemies. In fact, Obama had very little to do with the ppaca; this was a creature of congress.

      Further there were major concessions on the part of health care providers, health plans, hospitals and unions to get the bill passed. A big part of that was to ensure the benefits actually provide benefits to most members. That’s the core concept behind insurance. We all pay premiums to spread the risk and cost amongst as many as possible.

      As to the record profits enjoyed by health plans, I’d suggest some of the price increases and loss ratios that have been discussed here and elsewhere are more indicative of financial results than that statement.

      As I noted in the post, we are reforming 18% of the nations economy to increase coverage and improve outcomes. It’s messy and frustrating and people get hurt and others benefit and hopefully in the end it’s a lot better than where we would have been.

      I agree with you; there’s been no better, politically viable idea advanced. That’s because there aren’t any.

    • Paul – You cite patients who lost affordable coverage who were forced into more expensive plans. I know many people like myself who experienced the opposite. My previous coverage was $1,100/mo & $5K deductible with lots of exceptions for things I specifically needed (for example denied colonoscopies for 15 years in my 40s & 50s because I’ve had GI surgery, and cardiology procedures because I have high blood pressure). And I was constantly threatened with cancellation with no possibility of getting insurance again since I am self-employed with pre-existing conditions. (Blue Cross frequently didn’t process my payments and made me show proof that those payments cleared my bank, a ridiculous and annoying game they’d play 2-3 times a year.) My new “Obamacare” is $350/mo with a $2,500 deductible and no exceptions. For me and the millions of people in my situation, this was a vast improvement.

  4. As for your July10th blog, I believe the responders thereto may not have discerned that the PPACA laws were the first attempt during the past 40 years – prior to the adoption of ERISA in 1974 – by the Federal Government to make a serious attempt to materially and substantively address the pathetic state regulation of the health insurance industry. For this practitioner, “insurance regulatory” reform was very much needed and unfortunately it came far too late. To believe the PPACA is anything more than primarily the reform of the health insurance industry is unfortunate and it has led to all of the unfounded distortions that surround the “Obamacare” acts.

  5. I am a conservative and former business owner and provider(DME) so I really had to look at the ACA from several perspectives. 1) What impact does the “new”
    insureds have on the business model as far as profit. Yes, it did produce new customers and will produce more in the future and Yes, Medicaid did expand in the market both produced more dependable revenue vs OOP costs by the unisureds. I noticed they used it because now they had skin in the game. We can argue all day if that’s constitutional but right or wrong we know that “it is”
    2) Employers that pay at least 50% of the employee only cost for their employees are/will figure out in a lot of cases that all or many of their employees will qualify for the ACA plans. This has the ability to drastically drive down the employers “skin” in the game by shifting their employees healthcare from the employer roles. This can be a dramatic positive shift in the P&L of the business. Money that may can be used elsewhere, ie more employees, R and D, and yes dividends. This is empirical proof not to over react YET.
    Speaking to very high level HMA executive, he told me that yes we are paying for it one way or the other. He further went on to explain how. We either pay by subsidizing premium for the unisureds or by companies like HMA writing off by the millions the unisureds coming into their facilities and not being able to refuse care. Although a big Ronald Reagan fan, you can blame him for that one.
    Lastly, it has the ability to negatively impact us as well.
    1) More customers in the system frequenting the same amount of providers leaving us exposed to longer wait times for treatment.
    2) Providers figuring out that some insurance companies are limiting their PPO and /or lowering reimbursements for these plans further driving down access and choice.
    3) The most important and dangerous exposure of all and that is now the government has now mandated that everyone be insured or face increasing penalties and this can drive up premiums for all of us including the subsidies so they can make the argument down the road that the subsidies are unsustainable and we have to go to single payer.

  6. Good comments as always, Joe. Let me add my own two cents in these areas:

    1. When health care premiums go up, it is usually because the insurer has a sicker risk pool.
    We could theoretically freeze all health care prices for a year, and some insurance companies would still raise premiums because of who they are insuring.
    (and because the insurers are earning less money in their huge portfolios)

    2. I do not agree that the uninsured always cause higher prices. Texas as you say has a huge percentage of uninsured. Massachusetts has a much lower percentage of uninsured.
    But Mass. hospital prices are much higher than
    Texas prices in most cases.

    Bottom line, hospital greed would not go away even if 100% of Americans were insured.

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