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October 2015 low monthly prices leave insureds open to financial and healthcare disaster, experts say

By | Health Insurance, Health Reform, Uncategorized

According to The Department of Health and Human Services, returning customers to can save if they switch to the lowest-cost plan within their coverage level.  But experts say the monthly premium is misleading. They say quality and coverage of health plans makes exchange-based health insurance “a financial trap” since high deductibles, co-pays and limits on choices of providers can expose insureds to tens of thousands of dollars in hidden risk.Affordable_Care_Act_Photo

Healthcare watchdogs message to the American Public: “Beware of the huge ad campaign that the federal government is funding touting ‘low cost’.”  The administration is trying to find, woo and keep 10 million paying customers by this time next year.

“What the message should be is ‘be a smart shopper’,” said Caroline Pearson of Avalere Health, a private market analysis firm. “All we really see in this report is price, price, price. That’s what the government thinks will draw (consumers) to the market, but it may also be what disappoints them when they get sick.”  Consumers get fooled by low monthly premiums and are shocked when providers send them bills for co-pays and deductibles.

Living Benefits Insurance Could Help Pay for Dementia

By | Uncategorized

Did you know that a living benefits life insurance policy could pay for the costs of Dementia care?

People with dementia — especially those with Alzheimer’s disease — often live for years after reaching the point where they need 24-hour care, leaving families in an emotional, financial and logistical turmoil.

Dementia costs can be offset with Living Benefits Life Insurance

Dementia costs can be offset with Living Benefits Life Insurance

The Health-Life-Dental Insurance Real Life Pyramid includes a policy that is designed to provide financial support to you and your family against this and other long-term illnesses.  This is important because:

  • Medicare doesn’t pay for long-term nursing home care.
  • Long-term care insurance eases some of the financial burden. But experts say it often doesn’t cover what patients need.
  • Many families must turn to Medicaid to pay for in-home and long-term nursing home care. But there are restrictions – that the family’s resources be depleted. Experts say most states’ insist on asset and income depletion to the point that the patient’s spouse may “keep their house and one car”.

The Real Life Pyramid – the best value in health insurance on the market today.

Obamacare payment to insurers $2.5 billion less than expected

By | Health Insurance, Health Reform

Reneging on previous promises and guarantees, the federal government has decided to short insurance companies out of billions of dollars agreed to under Obamacare.


The Washington Examiner reports that, “Insurers learned late Thursday that they’ll receive just $362 million out of the $2.9 billion” they had requested from Obamacare in 2014. Why? Because Obamacare “hasn’t brought in nearly as much money as it needs to pay out.”

Unfortunately for insurance companies, they have enrolled higher numbers of older and sicker customers than anticipated. The Obama Administration promised the insurers federal funds “to help cover their costs, through a program known as risk corridors.”

Here’s how the program was supposed to work:

If a health plan found itself with at least 3 percent more medical claims than it had anticipated, the government would reimburse it for half of those losses. If claims surpassed expectations by more than 8 percent, the government would pay 80 percent of the losses.

However, “the law requires the program to be budget-neutral, meaning that if there aren’t adequate funds, insurers have to go without.” There’s the fine print that is the crux of the problem.

The response from the insurance industry  (hoping to see a boon to their bottom line under Obamacare) was harsh and swift.

“Stable, affordable coverage for consumers depends on adequate funding of the risk corridor program,” said Marilyn Tavenner, CEO of America’s Health Insurance Plans. “It’s essential that Congress and CMS act to ensure the program works as designed and consumers are protected.”

Notice the line, “stable, affordable coverage for consumers.” Many Obamacare enrollees would say that coverage has been anything but stable and affordable so far. Rates for plans offered through Obamacare are continuing to climb, and that doesn’t seem likely to change. With the loss of these expected funds to help prop up the bottom line of these insurers, further price increases in Obamacare plans are certain.

There is a ray of hope, if only a tiny one, as the Obama Administration said that insurers will “eventually” get their money.  That’s likely little consolation to insurers if the federal government’s track record is considered. One only has to look to the Individuals with Disabilities Education Act (IDEA), passed in 1975. During the years 1981-2010, states were shorted over $250 billion promised to them under the new law, but were of course still expected to comply.

With a mounting national debt of over $18 trillion, Washington’s ability to keep its promises isn’t likely to improve any time soon, and customers are likely going to continue to see higher premiums, larger deductibles, and smaller networks – exactly the opposite of what was promised under Obamacare.

Big shortfall in Obamacare risk program could hurt insurers

By | Health Reform, Uncategorized

A key federal program designed to cushion health insurers’ risks in the Obamacare exchanges has a massive shortfall, which could throw some insurers into financial turmoil.

By Tami Luhby   @Luhby

Insurers requested $2.87 billion in so-called “risk corridors” payments for 2014, but will only receive $362 million, or 12.6%, said the Centers for Medicare & Medicaid Services, which oversees Obamacare.Obamacare Shortfall

The risk corridors program’s goal is to help insurers transition into the individual exchanges, which opened in 2014. Insurers had a tough time setting premiums since they didn’t know how sick their new customers would be.

Under the three-year program, insurers whose premiums exceeded claims pay into the fund, while their peers who didn’t charge enough premiums to cover claims could draw from it.

But too many insurers miscalculated when they set their rates for 2014


Obamacare is actually not so affordable — unless you’re broke

By | Health Insurance, Health Reform

It’s time for the Affordable Care Act to join a long list of oxymorons.

The Street
Simon Constable

Why? Because rather like “military intelligence,” “cat proof,” “government organization,” and “simple calculus,” the law better known as Obamacare turns out to be an inherent contradiction. For a sizeable part of the population, anyway.Is Affordable Care Affordable?

The ACA is just not affordable to a big chunk of those it was most meant to serve: The previously uninsured. In fact, many are worse off than before, according to a new study. That fact could also unravel part of the program’s foundation, which could be a problem for healthcare insurers.

“Many of the non-poor formerly uninsured are estimated to be worse off,” than without insurance, according to a September-dated working paper from the National Bureau of Economic Research titled “The Price of Responsibility: The Impact Of Health Reform On Non-Poor Uninsured.”

How so? The subsidies are not large enough to offset the cost of the insurance premiums and the fact that many previously uninsured will now have to pay part of the cost to see a doctor, the report explains. The authors reached that conclusion after reviewing data for the uninsured prior to Obamacare, including age, gender, earnings and location. Then, they married that information with health-care expenditures for the group and used it to make estimates of out-of-pocket costs before and after the law went into effect.

The group of people whom the authors highlight are the non-poor, or those ineligible for Medicaid but who maybe eligible for various subsidies for premiums or cost-sharing, depending on their income level. It turns out that the more someone earns the worse off they’ll be.

“At higher income levels, small or zero subsidies and currently modest penalties will not be enough to affect the large welfare losses that the middle class uninsured experience were they to buy coverage,” the report says. Those in good health were “consistently worse off from purchasing coverage regardless of the assumptions made,” according to estimates calculated by the researchers.

Is this the fault of healthcare insurers like AetnaUnited HealthcareCigna, or Anthem ? Not really. It’s just the way the law is designed. Will it mess up their actuarial calculations? Probably so, because an important demographic of healthy people may simply not buy coverage.

“Most uninsured will lose and, according to our estimates, will prefer to remain uninsured at the current penalty levels for violating the individual mandate,” the report continues.

Ultimately, people will do what is in their own best interests. In this case, many individuals who realize that signing up for healthcare insurance is a losing proposition financially simply won’t do it.

In this case, it will be those with higher incomes and better health — the population insurance companies need in order for their actuarial assumptions to work.

What happens if the healthy don’t sign up? Either the insurance companies stand to take a loss because overall claims are larger than the revenue from premiums and subsidies, or they raise premiums, making it even more unlikely that the healthy will sign on.

The big question now: Who will bear the financial brunt of this problem, the people buying or the insurance companies or both?