How to Choose a Health Plan Under the Affordable Care Act (ACA-Obamacare)

By

Bob Aronson

While the Affordable Health Care Act got off to a very rocky start due to massive computer glitches there’s plenty of time for consumers to do research to find the best plan.

The problem faced by most people is trying to make sense of all the legal gobbledegoop.  How do you sort it all out so that you know which health insurance plan to choose?  Well, we think we have some answers for you but it is still going to take some work on your part.

Before we get into any advice here’s the link for information for the Affordable Care Act. It is where you will ultimately determine what kind of coverage you should have and from which company. https://www.healthcare.gov/

The first-ever open enrollment period for individual and family health insurance plans under the Affordable Care Act (ACA) began October 1 and ends March 31, 2014. Open enrollment periods in following years will be shorter than this one-time six-month period.

According to HealthCare.gov the law offers you these rights and protections.

• Creates the Health Insurance Marketplace, a new way for individuals, families, and small businesses to get health coverage
• Requires insurance companies to cover people with pre-existing health conditions
• Helps you understand the coverage you’re getting
• Holds insurance companies accountable for rate increases
• Makes it illegal for health insurance companies to arbitrarily cancel your health insurance just because you get sick
• Protects your choice of doctors
• Covers young adults under 26
• Provides free preventive care
• Ends lifetime and yearly dollar limits on coverage of essential health benefits
• Guarantees your right to appeal

If you have questions you can call 1-800-318-2596, 24 hours a day, 7 days a week. (TTY: 1-855-889-4325).  Judging from the initial experience, however, you can probably expect long wait times and delays.

There are lots of questions so to  help you make your way through the insurance maze.  We relied on several sources for our information among them are:

1)  Consumer reports magazine ( their report is here http://tinyurl.com/odmjmq2

2) The Health Insurance Resource Center http://tinyurl.com/n38asm6   and

3) Forbes Magazine http://tinyurl.com/mrce8lg

4. Politifact http://tinyurl.com/m5pbarx

5. U.S. Dept of labor http://www.dol.gov/ebsa/healthreform/

6. Henry J. Kaiser Family Foundation http://kff.org/health-reform/faq/health-reform-frequently-asked-questions/

7. eHealth https://www.ehealthinsurance.com/affordable-care-act/faqs

8. National Public Radio (NPR) http://www.npr.org/2013/10/11/231101137/faq-what-retirees-and-seniors-need-to-know-about-the-affordable-care-act

Each one of the preceding links is worth reading.  Your health and your financial stability may be on the line so this is absolutely necessary homework.

Health Coverage for Seniors

We’re going to offer information for everyone in this post but I’m going to start with Senior citizens.

The first thing seniors need to know is this. Medicare is not part of the  health insurance exchanges. The exchanges won’t be selling so-called “Medigap” policies that supplement the coverage seniors get through Medicare.

Seniors will still get health coverage through Medicare’s traditional fee-for-service program or Medicare Advantage plans.  Beneficiaries receive more preventive care, including a yearly “wellness” visit, mammograms, colorectal screening, and more savings on prescription drug coverage.  By 2020, the law will close the coverage gap which is also known as the “Donut Hole but  Seniors will still be responsible for 25 percent of their prescription drug costs.

Medigap Coverage

Seniors will still get health coverage through Medicare’s traditional fee-for-service program or Medicare Advantage plans, private health insurance plans that are approved by Medicare. Those who are enrolled in , which covers hospital care, or the Advantage plans will meet the health law’s .

Seniors were pretty much left out of consideration when ACA passed.  They get some benefits like the closing of the donut hole and health screening.  A glaring omission is that while pre-existing conditions cannot be considered for others, they are still a factor for seniors.  Medigap is not bound by that provision of the law.  Medicare is but not the Medigap supplemental policies.   But….and this is a very important But:

The most critical time for Senior Citizens is the six months after you first enroll in Medicare Part B. During that period, you can buy any Medigap policy you want, and the insurer can’t turn you down or charge you more than anyone else your age even if you have pre-existing conditions.

According to Consumer Reports Magazine (CR) you also have the same rights if you have a retiree or union plan that fills in Medicare’s coverage gaps but it ceases operation, or if your Medicare Advantage plan closes up shop or you move out of its coverage area. Read more about the difference between Medigap and Medicare Advantage.

CR goes on to say that Senior Citizens may be stuck with what they have.  “Although it never hurts to shop around. “Medigap plans are generally more permissive about underwriting than health plans sold to younger people,” said Bonnie Burns, a Medicare expert with California Health Advocates, a nonprofit consumer group. “Some are more strict than others.”

Medicare Advantage

Another issue of importance to Seniors is Medicare Advantage.   A Medicare Advantage Plan is a type of Medicare health plan offered by a private company that contracts with Medicare to provide you with all your Part A and Part B benefits. Medicare Advantage Plans include Health Maintenance Organizations, Preferred Provider Organizations, Private Fee-for-Service Plans, Special Needs Plans, and Medicare Medical Savings Account Plans. If you’re enrolled in a Medicare Advantage Plan, Medicare services are covered through the plan and aren’t paid for under Original Medicare.

There has been a lot of publicity about cuts to Advantage and a lot of seniors are worried so let’s address that issue.  According to Politifact, an on line, Pulitzer Prize winning organization that checks the accuracy of political stories Advantage is growing in size not getting smaller.  Here’s what they say:

“Today, around 14.4 million seniors and disabled people — that’s 28 percent of all Medicare beneficiaries — are in Medicare Advantage, the most ever.

Advantage plans are required to offer basic health benefits that are at least as rich as original Medicare. But many offer extras, such as rebates on premiums, routine dental care, gym memberships and rides to the doctor, in order to compete for business.

Medicare Advantage members pay premiums just like people who get their benefits through original Medicare.  The private companies turn a profit depending in part on how well they manage costs of care. Sweetening the deal: The government spends more per person — 7 percent more last year for Advantage beneficiaries compared with those in original Medicare, estimated the Medicare Payment Advisory Commission.

The Affordable Care Act aims to gradually bring costs of the two programs in line. At the same time, it seeks to reward private insurers that offer the best care — these are the plans that top the new star rating system.   You might think shrinking payments for Medicare Advantage would mean fewer enrollees, but that hasn’t happened. Since passage of the Affordable Care Act in 2010, enrollment in Medicare Advantage plans has grown by 30 percent.”

The Politifact analysis continues with this:

“After the health law passed in 2010, several government and private analysts predicted Advantage enrollment would decline. More recently, the Congressional Budget Office projected slow growth through 2022, while the CMS Office of the Actuary expects a decline between 2015 and 2018, then an increase.

It’s similarly tough to predict what will happen with costs and benefits, though it’s important to note that Advantage plans can never offer skimpier coverage than original Medicare. Government payments may go down, but they’re only one of the many factors that go into how insurers determine their offerings.

“The payment formula to Medicare Advantage is complex,’’ said Dan Mendelson, CEO of strategic analysis firm Avalere Health. “Honestly, to say that as a result of Obamacare there would be a reduction to Medicare Advantage would be misleading at best, because there are a lot of other things that come into play.’’

“We don’t know what’s going to happen, but that’s true every year,’’ said Joe Baker, president of the Medicare Rights Center, the national nonprofit advocacy group that fields around 12,000 calls a year to its consumer help line.

Still, Baker and others doubt seniors will find a September surprise in their mailboxes.
“If the last few years under the (health law) and this administration is any indication, it’s going to be a pretty smooth year and a pretty even year,’’ Baker said.

Mendelson, too, is dubious of a rate spike.

“In all likelihood, rates are going to be stable, and they’re going to be workable,’’ he said.

Medicaid

Medicaid presented a special difficulty in our effort to offer assistance  to those who need this service.  A U.S. Supreme Court decision left the decision about whether to participate in the Medicaid program under ACA up to the individual states and not all states chose to do so.  While we can offer this link that will help  you gain some understanding of your options, we likely will supplement this blog in a few days with a more detailed report.  http://www.apha.org/advocacy/Health+Reform/ACAbasics/medicaid.htm

Health Care Coverage for Everyone Else

The Exchanges

Plans offered will be in standardized “metal tiers” with various combinations of premiums and cost-sharing.  There are four distinct kinds of plans:

• Bronze plans will pay 60 percent of the bill and cost the least
• Silver plans will pay 70 percent.
• Gold plans will pay 80 percent.
• Platinum plans will pay 90 percent and cost the most.

Keep in mind that as the percentage of coverage increases so does the premium you pay — but it also means that you will pay less when you get the hospital bill.

Before you consider any plan you should begin by answering these four critical questions so you can make the best possible decision when you finally select a health insurance plan.   The questions are:

1. What does health care cost in your area?

2. How much have you budgeted for health care or, what can you afford?

3. What do you want from your coverage?  Do you have any special medical needs?

4. Does the plan cover the physicians and hospitals you prefer?

As I began my research for this blog I discovered almost immediately that finding the right health insurance coverage is not easy by any means.  It’s going to take some research and diligence on your part if you want the most bang for your buck.

So let us start with the first question.  What does health care cost in your area? Let’s make this as simple as possible.  The really important question is not what they charge but what do you have to pay?  Even that can get complicated because no plan pays a hundred percent and that means you pay something.  If the bill is a thousand dollars and your plan pays ninety percent then your share is one hundred dollars but if the bill is two thousand dollars and you plan still pays ninety percent you pay one hundred eighty dollars.  The ninety percent payment only becomes meaningful when you know the cost of the service or procedure.

Determining what a health care facility will charge you is not easy but we’ll try to help.  The problem is health care costs vary so greatly.   Here are some examples.

The Washington Post did an in-depth analysis of medical pricing in May of 2013 and found what to me is a shocking disparity between hospitals.  For example:

“Virginia’s highest average rate for a lower limb replacement was at CJW Medical Center in Richmond, more than $117,000, compared with Winchester Medical Center charging $25,600 per procedure. CJW charged more than $38,000 for esophagitis and gastrointestinal conditions, while Carilion Tazewell Community Hospital averaged $8,100 in those cases.”  The entire Washington Post article can be found here http://tinyurl.com/d3xm3g6

We advise you to read the Post report but thought we would include one more relevant piece of information from it.

“In our analysis of the 10 most common medical procedures we found certain patterns by state. Hospitals in six states — California, Florida, Nevada, New Jersey, Pennsylvania and Texas — routinely had higher prices than the rest of the country.

For-profit hospitals tended to bill Medicare at a 29 percent higher rate, on average, than nonprofit or government-owned hospitals.

Is this confusing?  You bet it is because hospitals and insurance companies play games with each other.  The prices and reimbursements they toss around make sense only to them and relate only to situations in which patients are either covered by insurance or Medicare.”

So, as I said earlier, “In the end what matters is what you pay, not what the hospitals charge or what either the government or the private insurers pay.

Deciphering Your Hospital Bill

When you get a hospital bill you must know what the codes mean or the bill is meaningless.  You need to be able to do some comparisons between faclities so we found the resources listed and outlined below. I have included information provided by the Centers for Medicare and Medicaid Services (CMS) the government agency that runs Medicare because they keep track of pricing for everyone, not just seniors.  Be aware, though, that even this attempt at clarification can be confusing and that’s because health care is confusing.

Here’s the link to CMS it is very complete http://tinyurl.com/blv4cwg

Here’s another helpful site but….in order to look up a price you will need the CPT code.  http://www.fairhealthconsumer.org/medicalcostlookup/.  Of course you probably don’t know what a CPT code is, right?  Ok — CPT codes (Current Procedural Terminology) are found and used to identify procedures for which you will be charged. A CPT code is a five digit alphanumeric code with no decimal marks. When you receive a bill from your doctor before or after it has been sent to the payer (insurance or Medicare), it will have a list of services. Next to each service will be a 5-digit code. That’s the CPT code.

The American Medical Association (AMA) has every code there is — but you can’t have them all unless you are a physician member who has paid a great deal for them. AMA has the copyright on CPT codes and guards it like it is a nuclear weapons cache.  They will give out one code at a time but they want you to suffer a little so its not easy.  Here’s how to do your AMA CPT code look-up:

• Step 1: Link to the AMA website
• Step 2: You’ll find an End-Use License. In essence it tells you that you may look up these codes only for your personal information and that you cannot sell them to anyone else. Further, it tells you that if they think you are using the system too much, they may limit your searches and/or limit the number of CPT codes you look up at one time. There is additional legaleese which you should probably read. You can also print the agreement.
• Step 3: Click on ACCEPT or DECLINE. If you click on DECLINE, you will not be allowed access to the code lookup.
• Step 4: The next page is your search page. Choose your state and city. If your city isn’t there, there will be a choice that makes sense. For example, if you live in Tampa, Florida, you’ll find that Tampa isn’t listed (only Miami and Ft. Lauderdale are listed) but there is a designation for “Rest of Florida.”
• Step 5: If you already have the CPT code and want to see what it means: Simply input the 5-digit CPT code to the field, hit SUBMIT, and you’ll get your result on the next page. Included will be the RVU – see below.
• Step 6: If you do not have the CPT code, but you know what the procedure or service was, you can do a search to try to figure out the right code. This can get tricky, though.

CMS uses CPT codes, too, but they are called HCPCS codes (why does government always have to change the name of commonly used terms?) and unlike AMA the codes are readily available and free but still take some work to ferret them out.  Here’s a link. http://patients.about.com/od/medicalcodes/a/Look-Up-Hcpcs-Codes.htm

Finally you can try these links for prices of common procedures.

• healthcarebluebook.com
• fairhealth.org
• utpricepoint.org

Quality of Care

One of the great mysteries in all of this is that while the government and others have done extensive studies on medical procedure costs in nearly every city and every facility the costs quoted bear no relationship to the quality of care and the outcomes of the procedures. That’s another story completely.  Major medical centers, especially the teaching centers seem to charge a lot more than other facilities.  Many believe that the more something costs the better it is.  That’s not ever true with anything and particularly with health care.  You just can’t judge the quality of care by the price that is charged for it.

The famed Cleveland Clinic suggests you ask these questions.

• Is the hospital accredited by the Joint Commission?

• Is the hospital rated highly by state or consumer groups?

• Does the hospital have experience and success with your condition?
• Is the hospital one where your doctor has privileges?
• Is the hospital covered by your health plan?
• Does the hospital review and continuously improve its own quality of care?

Finding the best quality care can be another daunting task and that’s entirely up to you.  This site may give you some help as you begin your search. http://www.ahrq.gov/legacy/consumer/guidetoq/guidetoq8.htm

OK.  Once you have determined costs in your area and the facility that offers the quality of care that you desire you now have three very important questions to answer before you make a decision on a health insurance policy.

1. How much have you budgeted for health care or, what can you afford?
2. What do you want from your coverage?  Do you have any special medical needs?
3. Are the physicians and hospitals you prefer included in the plan.

I’m not even going to attempt to help you with any of those questions because only you have the answers.  The  information I provided earlier, though, should help.

Consumer Reports says:

“Before health reform, companies could sell plansthat didn’t cover all types of medical care. For example, some might not cover doctor visits, or prescription drugs, or maternity care.

That was bad for consumers because no one can predict what kind of medical care they might need in the future. The only way to protect yourself financially is to have health insurance that covers every kind of health care.

The new health care law has fixed this problem.

Insurance sold to individuals and small businesses must now cover 10 “essential health benefits.”

• Emergency services
• Hospitalization
• Laboratory tests
• Maternity and newborn care
• Mental health and substance-abuse treatment
• Outpatient care (doctors and other services you receive outside of a hospital)
• Pediatric services including dental and vision care.
• Prescription drugs
• Preventive services (such as immunizations and mammograms) and management of chronic diseases such as diabetes
• Rehabilitation services

The rules for insurance provided by large employers are a little different but most of them will cover the same set of benefits. To make sure, ask your employer for the Summary of Benefits and Coverage, a standard form that will state exactly what the plan covers and doesn’t cover.

Get health insurance rankings

In general, if you pay a higher premium upfront, you will pay less when you receive medical care, and vice versa.”

I strongly advise readers to click on and read the links at the top of this blog provided by Consumer Reports, the Health Insurance Resource Center,  Forbes Magazine and the others.  They are all credible resources.

If you want to know all the details of the Affordable Care Act and how they are implemented year by year click on this site. http://www.hhs.gov/healthcare/facts/timeline/timeline-text.html

And finally, I’m sure I’ve missed a great deal here and I’m just as sure some of you will have suggestions. They are welcome. Please leave them in the comment section below.

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We hope you found this helpful.  Please let us know if you have questions or comments.

Bob Aronson of Bob’s Newheart is a 2007 heart transplant recipient, the founder of Facebook’s nearly 3,000 member Organ Transplant Initiative and the author of most of these donation/transplantation blogs.

You may comment in the space provided or email your thoughts to me at bob@baronson.org. And – please spread the word about the immediate need for more organ donors. There is nothing you can do that is of greater importance. If you convince one person to be an organ and tissue donor you may save or positively affect over 60 lives. Some of those lives may be people you know and love.

Please view our new music video “Dawn Anita The Gift of Life” on YouTube https://www.youtube.com/watch?v=eYFFJoHJwHs.  This video is free to anyone who wants to use it and no permission is needed. 

If you want to spread the word personally about organ donation, we have another PowerPoint slide show for your use free and without permission. Just email me bob@baronson.org and ask for a copy of “Life, Pass it on.“  This is NOT a stand-alone show; it needs a presenter but is professionally produced and factually sound. If you decide to use the show I will send you a free copy of my e-book, “How to Get a Standing “O” that will help you with presentation skills. 

Also…there is more information on this blog site about other donation/transplantation issues. Additionally we would love to have you join our Facebook group, Organ Transplant Initiative The more members we get the greater our clout with decision makers.