Is ObamaCare Junk Insurance, Especially For Low-Income Americans?
Many of ObamaCare’s advocates believe that the proportion of a household’s income spent on health care is an appropriate measure of how effective health insurance is at doing its job. If a household spends ten percent or more of income on health care, it is said to be “underinsured” by the Commonwealth Fund or the Kaiser Family Foundation. Five percent is the cut-off for low-income households.
According to that standard, ObamaCare fails miserably at insuring low-income households:
In Washington, one in four individuals in households earning less than 250% of the poverty level signed up for a bronze plan with a deductible of $5,000-$6,350 per person and $10,000-$12,700 per family. Even after premiums, these households could face medical costs ranging from 17% to 40% of income before ObamaCare’s non-preventative-care benefits kick in.
Beyond the premium subsidies that the law provides, households earning up to 250% of the poverty level qualify for cost-sharing assistance. It can greatly reduce the deductible that must be exhausted before benefits kick in and, after that, the co-payments required for medical services and prescription drugs. But those cost-sharing subsidies are available only for those who buy silver-level coverage…
Source:Investor’s Business Daily.
But…I thought Obamacare was supposed to get rid of junk insurance!
The amount a family spends on health care is a function of many things: these include health status, age, income, priories and preferences. For instance, women tend to spend more on health care than men. Wealthy people tend to spend more on health care than poor people. Older people tend to spend more on medical care independent of health status. The notion that a given family should not spend more than 10% (or less than 5%) on medical care doesn’t have a valid rationale.
Exactly right Devon, it is frustrating to constantly hear that people do not know how to pick the plans that best suite them. Having to meet the requirements of Obamacare means that some healthy people, who may not need more expensive coverage, are forced to obtain more comprehensive coverage simply because the bureaucracy has magically come up with this 10% (or 5%) figure.
Indeed they have rationale, and they are not intended to. Such arbitrary reasoning is just one more manner by which the ACA is meant to further control people’s decision-making process and lives.
*Indeed they have NO rationale…
Well the bureaucracy has to pay for the older, more expensive folks some how. Thus the individual mandate and forcing young people into more comprehensive plans.
The silver plan clearly seems like the best option for Obamacare. While I don’t necessarily agree with the goals and aims of the program since I believe in minimal government intervention, if this is the way it is going to be then they should advertise the silver plan as opposed to the bronze plan for the Affordable Care Act (ACA).
But they get more money out of the bronze plan. Why advertise your silver plan, when you can dupe people into choosing your bronze plan.
“According to that standard, ObamaCare fails miserably at insuring low-income households”
I mean…is anyone really that surprised?
And wasn’t the whole point of having health care reform to help low income households. Everyone else had coverage but them, “allegedly.” They were supposed to be the winners in all of this.
“Many of ObamaCare’s advocates believe that the proportion of a household’s income spent on health care is an appropriate measure of how effective health insurance is at doing its job.”
It is based on an individual’s needs. If they value health insurance at a higher or lower proportion to their income, that is their preference.
“But those cost-sharing subsidies are available only for those who buy silver-level coverage…”
That’s the catch. They will not receive the subsidy unless they buy a silver plan. Other than a lower premium, there really is no incentive to buy a bronze plan.
Except I am sure many ObamaCare insured people have no idea of this policy. They give a façade of a cheaper plan, but is expensive because to the lack of cost-sharing subsidies.