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Many of the millions of people being dumped from their private health plans by the Obamacare law will be still be uninsured come January. But there’s still time to help these victims of the “reform.”
The president’s “make good” — allowing states to let insurers extend the canceled policies — won’t do much. Many states aren’t going along with it, and in those that are it’s often too late to extend or reinstate the coverage.
Meanwhile, Obamacare’s enrollment portal is still broken. People may think they’ve enrolled, but insurers report that the back-end job of transmitting that data (and paying subsidies) doesn’t work, or isn’t even built.
And middle-class families who are finally able to sign up often won’t qualify for significant subsidies to buy the costly Obamacare plans. They’ll find coverage unaffordable — or they’ll find they have to buy a cut-rate “bronze” plan with extremely limited choices of doctors.
Instead of leaving these families in limbo, or forcing them onto Obamacare, we can make good on the spirit of the president’s “keep your insurance” promise by letting them shop for policies inside the Federal Employees Health Benefits Program.
This is the marketplace where federal employees and their dependents buy health insurance. Its options are far better and often more affordable than Obamacare.
A national, regulated exchange that offers high-quality and competitively priced health care plans because it operates like a real marketplace, the FEHBP lets participants choose from thousands of options. Because the plans are freer to tailor benefits to match consumer choices, the options end up being better matched to the needs of families, and can remain affordable.
The sticker price of many FEHBP plans is markedly cheaper than Obamacare. In Florida, for example, the list price for the cheapest FEHBP plans is $409 a month for an individual, with many 2014 plans offering premiums under $500. This is for fairly comprehensive coverage that has typically lower deductibles and/or co-pays than similarly priced Obamacare plans.
By comparison, the average Florida premiums for a lower-tier “Silver” plan in Obamacare ranges from $315 to $464 for an individual, although costs get much higher for older people.
And the Obamacare plans hold down costs by tightly controlling access to providers, just like Medicaid. One plan in Miami-Dade County lists only 18 gynecologists, while another in Sarasota County, population 390,000, only includes 20 general surgeons.
In New York City, a middle-class, middle-aged man shopping in Obamacare will pay anywhere from $329 (for a restrictive plan that taps a Medicaid provider network, and has a deductible of $6,350) to a high of $965 a month for more complete coverage with more access to doctors. In the FEHBP, by comparison, the list price of a plan with a good network of providers starts at $383, with many options at or below $500.
The FEHBP prices are even better in markets that are home to lots of federal employees. In Virginia, an FEHBP option that affords a flexible network of doctors and lower out-of-pocket charges will cost around $450. Similar coverage in Obamacare starts at about $550.
Obamacare imposes hundreds of mandates on plans, and prescribes a single benefit package. Different Obamacare options (Platinum, Gold, Silver and Bronze) are really the same plan. The only thing that varies between these different “metal” options is how co-pays and deductibles are structured, and the scope of provider networks.
You can’t buy-up to better benefits — and often the provider networks are exactly the same between the low-cost Bronze plans and the presumably better Platinum ones.
That leaves insurers competing on just a few things — and trying to hold down spending by limiting access to doctors.
By contrast, the benefits in FEHBP policies are tailored to meet customer demand. The plans run the gamut between more affordable plans like traditional HMOs to indemnity insurance that costs more but provides a wide choice of doctors.
And the prices in the FEHBP are low even despite its largely older-aged (and costlier) pool of federal workers. That said, the policies will likely cost more than those that Obamacare canceled. Congress could ease the pain by letting the “orphans” use pre-tax dollars to buy the FEBHP policies.
This solution is the best available way to make good on the president’s broken promise. But the timing is tight: Only three weeks remain in 2013, so Congress must act quickly.
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