Health insurance provider UnitedHealth says that it expects to lose hundreds of millions of dollars on its exchange policies in 2015 and 2016, and will be deciding whether to participate in the Affordable Care Act’s (ACA) government-run markets before the next open enrollment period.
“We cannot sustain these losses. We can’t really subsidize a marketplace that doesn’t appear at the moment to be sustaining itself,” UnitedHealth said in a statement about its Obamacare health insurance offering.
Healthcare insurance costs
UnitedHealth is the U.S.’s largest health insurer, but has limited its participation in the ACA markets – covering only about 5 percent of the overall 10 million or so customers of exchange plans now. Anthem and Aetna are the primary players, but they are struggling as well. Aetna has said it is losing money on its ACA plans, Anthem said it making less than it would like. In addition, 12 of the 23 nonprofit exchanges created to sell insurance under the ACA are closing down, due to financial losses.
UnitedHealth’s announcement was just part of a recent tsunami of bad news about Obamacare. ProPublica journalist Charles Ornstein tweeted that “Not since 2013 have I seen such a disastrous stream of bad news headlines for Obamacare in one 24- hour stretch.” Other issues in the news were complaints about higher premiums and higher deductibles in the ACA markets this year.
Healthcare insurance deductibles
The majority of health insurance plans have “deductibles,” plan members must pay the deducible before their insurance coverage begins. The typical plan offered by employers has a $1,320 deductible for an individual. But in many states, more than half the plans offered for sale through HealthCare.gov, the federal online marketplace, have a deductible of $3,000 or more, a New York Times review has found.
In Miami, the median deductible, is $5,000. (Half of the plans are above the median, and half below it.) In Jackson, Miss., the median deductible is $5,500. In Chicago, it is $3,400. In Phoenix, it is $4,000; in Houston and Des Moines, $3,000.
People with annual incomes from 100 percent to 250 percent of the poverty level ($11,770 to $29,425 for an individual) can qualify for “cost-sharing reductions,” which lowers their deductibles. Other consumers say that although they have insurance, they can’t afford to use it because they still have to pay out of pocket for their medical expenses.
Obamacare penalties: the Individual Mandate
Some people feel that paying the ACA penalty – officially known as the “Individual Mandate” – for not having insurance is less expensive that paying for a policy they can’t use. The penalty for not having health insurance in 2016 is whatever figure is higher: 2.5% of household income, or $695 per adult and $347.50 per child under 18 (maximum penalty $2,085).
Savings or discount plans, such as the ones offered by dentalplans.com, can help people with high deductibles get the care that they need.
Dental-only plans reduce the cost of dental care by 10%-60% (the savings vary according to the dental treatment, your location and the plan you choose). Many plans also include free bonus benefits that provide significant discounts on prescription drugs, vision and hearing care, wellness services and products along with dental care savings. Select plans, such as :DP Health Now and CVS iSave, offer free consultations with doctors who can diagnose and treat ailments via a phone call or web chat, savings on prescriptions, vision, dental chiropractic, fitness, hearing and more.
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