Thursday, March 21, 2013

Fwd: qotd: Low cost eHealthInsurance plans exposed

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-------- Original Message --------
Subject: qotd: Low cost eHealthInsurance plans exposed
Date: Thu, 21 Mar 2013 06:47:07 -0700
From: Don McCanne <>
To: Quote-of-the-Day <>

March 18, 2013
eHealth Data: Premiums 47% Higher for Individual Health Insurance Plans
with Comprehensive Health Benefits

Today eHealth, Inc., parent company of, America's
first and largest private online health insurance exchange, released a
'Cost of Comprehensive Health Benefits' report. This new report shows
that average monthly premiums for individual health insurance plans are
forty-seven percent (47%) higher than average when they cover a
comprehensive list of eight health benefits.

Since 2005, eHealth's Cost and Benefits report has tracked the
percentage of plans surveyed that cover eight health benefits deemed to
be comprehensive by eHealth, including: Laboratory and X-Ray; Emergency
Services; Prescription Drugs; Chiropractic; Maternity; OB/GYN; Periodic
Exams; and Well Baby care.

In 2010, the Affordable Care Act (ACA) created a new list of ten
Essential Health Benefits (EHBs) that all major medical health insurance
plans must cover at an actuarial value of 60% or more in order to
fulfill the federal mandate for health coverage, beginning in January of
2014. Those EHBs include: ambulatory patient services; emergency
services; hospitalization; maternity and newborn care; mental health and
substance use disorder services, including behavioral health treatment;
prescription drugs; rehabilitative and habilitative services and
devices; laboratory services; preventive and wellness services and
chronic disease management; and pediatric services, including oral and
vision care.

The data presented in this report do not reflect the impact that new
Essential Health Benefit (EHB) standards will have on plan prices, nor
does the report take into account other factors that may impact the cost
of health insurance in 2014. Not only do some of the benefits differ and
overlap, but chiropractic care is not deemed to be an EHB by the ACA.

"These data provide valuable insight into the cost of health insurance
plans as consumers prepare to enroll in the more comprehensive health
plans that will become available with the Affordable Care Act," said
eHealth Senior Vice President of Carrier Relations Robert Hurley. "Our
report does not provide an 'apples to apples' comparison of plans that
cover the essential health benefits established in the Affordable Care
Act, but it does provide some interesting insight into the potential
impact that new benefits standards could have on the cost of health
insurance plans in the individual health insurance market."


Los Angeles Times
March 19, 2013
Richer health benefits cost 47% more, industry report warns
By Chad Terhune

"I think consumers can expect new health plans next year are going to be
somewhere between 40% to 60% more expensive," said Bob Hurley, eHealth's
senior vice president of carrier relations. "I think there is a fair
amount of concern that the health plan requirements are too rich.",0,2057027.story

Comment: Many critics of the Affordable Care Act (ACA) say that the
health plans to be offered in the proposed state insurance exchanges
should be replaced with plans that have fewer regulatory requirements
and that can be sold across state borders. They often cite the bargain
prices of plans offered by eHealthInsurance as an example of how we
could make health insurance more affordable for everyone. So what is
eHealthInsurance offering?

By their own analysis, eHealthInsurance does not consider their plans to
be comprehensive unless they offer the eight benefit categories listed
in the article excerpt above. If those benefits are included, the
premiums are 47 percent higher for both individual and family plans than
the premiums for their cheapest plans. Note that these eight benefits
are not the same as the ten benefit categories that are required as
essential health benefits under ACA, so it is likely that the premiums
under ACA will be even more than 47 percent higher than the cheap
eHealthInsurance plans. This doesn't even take into consideration cost
sharing such as the deductibles.

There is already concern that the benchmark silver plans under ACA, with
an actuarial value of only 70 percent (patient pays 30 percent of costs,
which might be partially offset by income-indexed subsidies), may leave
patients vulnerable to excessive out-of-pocket costs. If the stripped
down eHealthInsurance plans were allowed as replacements for exchange
plans, it is inevitable that most enrollees would face financial
hardship should they develop significant medical problems.

So what is the response of eHealthInsurance? eHealth senior vice
president Robert Hurley says, "I think there is a fair amount of concern
that the health plan requirements are too rich."

This exposes the highly touted low cost eHealthInsurance plans as the
shoddy plans that they are. You might be nominally insured, but don't
you dare get sick.

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