Earlier this week, I called Blue Cross (in Texas) for a client in order to purchase a “new” BCBS policy. Normally every 5 years or so, we do this, in order to reduce his premiums about 50%. He has had his coverage through BCBS over 20 years.
When I asked for the new quote, it was $19 a month MORE than his current policy.
When I asked the rep why this was, she said it was due to the newer benefits under this higher priced policy, particularly the unlimited preventive benefits, no annual maximums, and no lifetime maximum.
I went to e health insurance with similar results!
Hold on to your seat belts!
Don Levit
purchase a “new” BCBS policy. Normally every 5 years or so, we do this, in order to reduce his premiums about 50%.
Curious– Why should a new policy be cheaper? Is it because of adverse selection against the “old” pool,as healthy individuals shop around, leaving those whose only choice is guaranteed renewal?
Bart:
Exactly right. In addition, BCBS closes off blocks of business, not allowing new entrants to the “class” of insureds. Sort of like the reverse of a ponzi scheme.
Don Levit
I am sorry to see these numbers for individual health insurance. I purchased my health insurance two years ago using eHealthInsurance.com and money from my HRA. I suspect that the decline in individual health insurance application volume is a probably a result of the Affordable Care Act’s objective to get rid of HRA and HSA and the increasing cost of health insurance. For the healthy, unemployed people the decision to cut health insurance is a better option than not eating. For those healthy people who have the income but live in states whose insurance policies have priced health insurance above the HRA maximums,the savy person is probably looking at dropping their policies, saving the money in a HSA, and re-applying for insurance in 2014.
It is too bad about ehealthinsurance.com. I was hoping some states would sub-contract ehealthinsurance.com and other companies like them for their health exchanges. eHealthInsurance.com has a working product and experience in the area. I think their shopping experience is a more viable product than the existing health exchanges. For kicks I ran my information through the Massachusetts health exchange and I was not impressed with the cost or the options available. I was unable to try out the Utah health exchange. Considering all of the talk about health exchanges, I would say the current health exchanges are all sizzle and no steak. The idea of each state creating their own health exchange from scratch sounds like a really dumb idea.
Of course ObamaCare is reducing sales of individual policies. And it will get much worse. With the uncertainty, insurers are jacking up premiums now since they don’t know what tomorrow will hold. With lifetime and annual benefit caps removed, the policies already cost more. People who hold out for two more years will be allowed to buy health insurance in the exchange regardless of health status. Why buy insurance now? The incentive is to wait until you are sick to enroll.
This chart is very worrisome.
It’s hard for private insurers when the competition is the government. I can’t imagine losing the under 26 market in one day.
Ominous.
I think one goal of Obama Care all along has been to destroy the market for individual coverage.
Earlier this week, I called Blue Cross (in Texas) for a client in order to purchase a “new” BCBS policy. Normally every 5 years or so, we do this, in order to reduce his premiums about 50%. He has had his coverage through BCBS over 20 years.
When I asked for the new quote, it was $19 a month MORE than his current policy.
When I asked the rep why this was, she said it was due to the newer benefits under this higher priced policy, particularly the unlimited preventive benefits, no annual maximums, and no lifetime maximum.
I went to e health insurance with similar results!
Hold on to your seat belts!
Don Levit
Curious– Why should a new policy be cheaper? Is it because of adverse selection against the “old” pool,as healthy individuals shop around, leaving those whose only choice is guaranteed renewal?
Bart:
Exactly right. In addition, BCBS closes off blocks of business, not allowing new entrants to the “class” of insureds. Sort of like the reverse of a ponzi scheme.
Don Levit
I am sorry to see these numbers for individual health insurance. I purchased my health insurance two years ago using eHealthInsurance.com and money from my HRA. I suspect that the decline in individual health insurance application volume is a probably a result of the Affordable Care Act’s objective to get rid of HRA and HSA and the increasing cost of health insurance. For the healthy, unemployed people the decision to cut health insurance is a better option than not eating. For those healthy people who have the income but live in states whose insurance policies have priced health insurance above the HRA maximums,the savy person is probably looking at dropping their policies, saving the money in a HSA, and re-applying for insurance in 2014.
It is too bad about ehealthinsurance.com. I was hoping some states would sub-contract ehealthinsurance.com and other companies like them for their health exchanges. eHealthInsurance.com has a working product and experience in the area. I think their shopping experience is a more viable product than the existing health exchanges. For kicks I ran my information through the Massachusetts health exchange and I was not impressed with the cost or the options available. I was unable to try out the Utah health exchange. Considering all of the talk about health exchanges, I would say the current health exchanges are all sizzle and no steak. The idea of each state creating their own health exchange from scratch sounds like a really dumb idea.
Of course ObamaCare is reducing sales of individual policies. And it will get much worse. With the uncertainty, insurers are jacking up premiums now since they don’t know what tomorrow will hold. With lifetime and annual benefit caps removed, the policies already cost more. People who hold out for two more years will be allowed to buy health insurance in the exchange regardless of health status. Why buy insurance now? The incentive is to wait until you are sick to enroll.