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Sunday, October 20, 2013

Exact Affordable Care Act insurance costs remain murky

Almost a month after the nation began what is proving to be a rocky shift to a new form of national health insurance, the basic question of how much health insurance will cost people under the Affordable Care Act is still hard to answer.

Contributing to the murkiness are continuing problems with the federal government’s insurance exchange website and the evolving nature of a system that was built from scratch. ...

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Almost a month after the nation began what is proving to be a rocky shift to a new form of national health insurance, the basic question of how much health insurance will cost people under the Affordable Care Act is still hard to answer.

Contributing to the murkiness are continuing problems with the federal government’s insurance exchange website and the evolving nature of a system that was built from scratch.

For example, if you make too much money to quality for tax-credit subsidies, the premiums could be higher than you expect, assuming you can even figure them out.

“It won’t be easy or cheap,” Ed Stebbins, of Nashua, an independent insurance broker, said after a run-through with The Telegraph of some pricing scenarios.

He used the federal website, Healthcare.gov, and an Anthem Blue Cross Blue Shield website set up for insurance brokers.

We ran scenarios for a family of four – a 40-year-old father, 38-year-old mother and two preteen children, none of them smokers or suffering from major pre-existing conditions – with an income greater than four times the poverty level, meaning they can’t get tax credits.

The result? For insurance coverage that falls into what Healthcare.gov calls the “bronze” level – around $5,000 annual deductible
per person and twice that for family, some prescription
coverage and some office visit copays – the hypothetical family will spent $160 a month less in premiums buying now compared with buying after Jan. 1, when all insurance must meet certain Affordable Care Act mandates.

To be specific, the premiums were $513 a month now but $673 a month next year, according to Stebbins’ work.

The difference is less than it seems because the deductible was a few hundred dollars higher – in other words, better – under the plan after Jan. 1, which is nothing to sneeze at.

Differences could be greater or less if you choose different levels of Affordable Care Act health insurance, which ranges from a cheap plan for people younger than 30 that basically covers only major catastrophes to a “gold” plan that Stebbins quickly calculated could run $1,400 a month or more for a family.

Income also makes a big difference in the results. If our hypothetical family made less than $94,000, tax credits would start to be available that can cut premiums significantly; Stebbins sent a follow-up note that a family of three making $40,000 would get a $5,500 tax credit, making insurance essentially free.

But if income falls below about $32,500 a year, insurance isn’t available under the Affordable Care Act because of a much discussed gap – unless New Hampshire expands Medicaid coverage. The state Legislature will take up this question soon.

All of these caveats show why so much uncertainty remains about the exact effects of the Affordable Care Act on people who don’t have insurance they plan to keep. Technical problems with Healthcare.gov have stymied most attempts to create accounts and do the sort of price-and-service shopping that the federal network is designed to facilitate.

By some estimates, fewer than one-tenth of 1 percent of people nationwide who have logged into the site have been able to create an account and buy insurance.

Stebbins isn’t exactly a neutral observer. He’s a Republican who worked on one of Charlie Bass’ campaigns, and he said he’s no fan of much that’s linked to President Obama. He’s also an independent insurance broker who wants customers to think of people like him when buying health insurance.

Stebbins said he isn’t an opponent of what is sometimes called Obamacare – “The idea is good, but I think they took it too far” – and agrees that the current insurance system needed to be fixed. That’s why, he said, such past GOP stalwarts as President Richard Nixon and House Speaker Newt Gingrich wanted to institute health insurance reform.

As an example of current problems, Stebbins, a former car salesman, notes that he had difficulty affording insurance under private-company rates for contractors, who use the 1099 IRS form.

He also mentioned a client whose premiums would have risen from $350 to roughly $650 under Affordable Care Act mandates –
except that as a diabetes patient, the client can’t get insurance at all right now.

The Affordable Care Act forbids companies from denying coverage for such pre-existing conditions, making insurance available to that person.

David Brooks can be reached at 594-6531 or dbrooks@nashua
telegraph.com. Also, follow Brooks on Twitter (@Telegraph_DaveB).