by Diane Dimperio
Insurance companies are not established to help people. Most are for-profit businesses with stockholders expecting a return on investment which creates pressure to spend less than they earn. Insurance is a risky business and successful companies have learned how to manage their operation to meet statutory requirements while generating a profit.
The majority of people with health insurance are enrolled through an employer, which offers several advantages. Employers have competent professionals negotiating comprehensive plans, the employer pays a large portion of the premium and negotiates out-of-pocket costs for employees. The larger the number of employees the more favorable terms the employer is able to negotiate.
The Bad Ol’ Days
Before the Affordable Care Act (ObamaCare) was passed, insurance companies used a variety of strategies to control spending. They limited what they would spend on anyone in a year and over their lifetime. This meant if you had serious health problems, you may have run out of insurance coverage and then were expected to pay all the costs yourself. Policies had limits on which and how many services they covered. For example, some plans did not cover mental health, some plans did not cover pregnancy, and many had limits on the prescription medicine they would provide.
People who worked for themselves or for an employer who did not offer insurance were on their own. They could go to a broker who offered preset plans for which the buyer paid 100 percent of the premium. These plans typically excluded coverage of services related to preexisting conditions, and some people with preexisting conditions such as diabetes were not even able to purchase a policy.
The consumer had to decide on the plan they would purchase. The phrase you “don’t need to buy more than you need” was used to lull consumers into a comfort zone when making a decision on what plan to purchase. Of course, the whole concept of insurance is preparing for the unknown, so no one knows what they will need. There are only three ways to reduce the cost of insurance: reduce the cost of healthcare, include many low risk individuals in the plan, and reduce the type and amount of services the plan covers. Use of the third strategy was used to make plans in the individual market affordable.
Post ACA
The ACA improved the quality of insurance coverage. Plans had to include essential benefits such as hospital care and women’s health, and were prohibited from setting annual and lifetime limits or charging people with preexisting conditions higher premiums.
The ACA required that preventive services, like cancer screening, be provided without a copay and allowed parents to retain children on their policy until age 26.
The ACA established the “Market Place,” which provides on-line access to adults, who have low and moderate incomes, to affordable insurance. The cost of the monthly premium is adjusted based on family income, so adults with lower incomes pay less. Nationally there are over 11 million people who are enrolled in Market Place plans.
The original blueprint of the ACA included enrollment of very low-income adults in Medicaid, which offers a rich benefit package and has no premiums nor co-pays. This component was made optional by the Supreme Court, but 38 states and the District of Columbia participate, and about 12 million are enrolled.
Florida has not yet agreed to expand Medicaid even through there are about 1.5 million uninsured adults who would benefit.
California v. Texas, a lawsuit attempting to abolish the ACA, was argued in front of the Supreme Court of the US (SCOTUS) on November 10. Eighteen states, including Florida, under the leadership of Texas, originally filed a lawsuit against the United States.
Since the current administration supports the demise of the ACA, the State of California and 16 additional states, along with the U.S. House of Representatives, defended the ACA. Although, the comments made by justices during the argument suggest optimism, experienced SCOTUS watchers warn it is dangerous to speculate on the final judgement, which may not be announced until June 2021.
One possible outcome of the lawsuit is that restrictions placed on ACA benefits would be limited to the participating states. The Florida Health Justice Project is encouraging Florida’s Attorney General (AG) Moody to pull Florida out of the case. Two other states have already dropped out. This would offer the possibility of protecting Florida from losing ACA benefits.
Abolishing the ACA in Florida would mean 2 million people currently enrolled in the Market Place would lose insurance, 8.4 million people with pre-existing conditions could face higher premiums and 860,000 newly uninsured due to pandemic job losses would not be able to participate in Market Place insurance.
Loss of the ACA would be devastating to Florida. It would cause a major disruption in the healthcare arena, reduce the economic contribution of the federal funds flowing into the state and severely limit access to vital health services.
Contact AG Moody or your legislative representative to encourage Florida to withdraw from California v. Texas.Uninsured adults should go to HealthCare.gov and begin the enrollment process. Anyone needing help may call Covering Florida at 877-813-9115 and talk with a navigator or check out the website www.coveringflorida.org for more information.