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Debates Forum

Debates Forum

  1. 24 Jul '12 02:44 / 1 edit
    Last week we received a modest rebate check from my health insurance carrier. The accompanying letter stated that the rebate was required by the Affordable Care Act (ACA) because the carrier had exceeded the limits (under the Act) for the retention rate (the amount of premiums collected that do not go to paying actual benefits). As I understand it, the ACA requires that the retention rate be no more than 15%-20%, depending on group size—that is, that at least 80% to 85% of collected premiums must go toward benefit payouts, thereby limiting the profit margin (after administrative costs) of the insurance company (the “medical loss ratio standard”—in my case, the 80/20 ratio).

    The accompanying letter included this sentence: “The 80/20 rule in the Affordable Care Act is intended to ensure that consumers get value for their health care dollars.” An article that I read on the Huffington Post today indicated that about 12.8 million households will receive such rebates, presumably with similar explanations.

    As Republicans talk about “repeal and replace”, what effect do you think these rebates might have among the electorate?
  2. 24 Jul '12 03:54
    LATE EDIT: Although ours is a household of modest income, the amount of the rebate check itself will have little impact on our expenditure patterns. That in itself would not change my voting intentions. My question has to do with how voters are likely to perceive the ACA generally, after receiving even modest premium rebates, with the accompanying explanations.
  3. Subscriber Kewpie
    since 1-Feb-07
    24 Jul '12 06:07 / 1 edit
    Any good health insurance system should have built into it a restriction on excess profits. This market cannot be entirely unprotected, otherwise there would be no cover available for anyone who wasn't in perfect health, and providers could offload anyone who became ill, leaving them without cover after possibly many years of contributions. It sounds as if your Affordable Health Act includes some protection against exploitation by providers. I doubt that it has any connection with voting patterns, in this country it certainly wouldn't have, rather an attempt to protect the weaker party in the health insurance transaction (the consumer).
  4. 24 Jul '12 14:44
    Originally posted by vistesd
    Last week we received a modest rebate check from my health insurance carrier. The accompanying letter stated that the rebate was required by the Affordable Care Act (ACA) because the carrier had exceeded the limits (under the Act) for the retention rate (the amount of premiums collected that do not go to paying actual benefits). As I understand it, the ACA ...[text shortened]... ut “repeal and replace”, what effect do you think these rebates might have among the electorate?
    I had a very different experience recently. Our rates went up over 7% (which was much less than the normal double digit rate increases) but significantly higher than the .15% interest rate you get on money in the bank.
  5. Standard member sh76
    Civis Americanus Sum
    24 Jul '12 16:09
    I just got a letter saying that GHI is planning to seek a 24% increase in premiums for my next renewal.

    24%.

    The ACA doesn't seem to have helped me very much.
  6. Subscriber Kewpie
    since 1-Feb-07
    25 Jul '12 01:47
    Perhaps it's time for you to shop around for another insurer.
  7. Standard member sh76
    Civis Americanus Sum
    25 Jul '12 02:28
    Originally posted by Kewpie
    Perhaps it's time for you to shop around for another insurer.
    Yeah, well. Unfortunately, it's not that simple. It's not like I'm on a solo plan.
  8. 25 Jul '12 12:17
    Originally posted by sh76
    I just got a letter saying that GHI is planning to seek a 24% increase in premiums for my next renewal.

    24%.

    The ACA doesn't seem to have helped me very much.
    You say planning to seek, who do they have to clear it with.
  9. Standard member sh76
    Civis Americanus Sum
    25 Jul '12 13:25
    Originally posted by kevcvs57
    You say planning to seek, who do they have to clear it with.
    Some state regulatory agency
  10. 26 Jul '12 14:53
    Originally posted by vistesd
    Last week we received a modest rebate check from my health insurance carrier. The accompanying letter stated that the rebate was required by the Affordable Care Act (ACA) because the carrier had exceeded the limits (under the Act) for the retention rate (the amount of premiums collected that do not go to paying actual benefits). As I understand it, the ACA ...[text shortened]... ut “repeal and replace”, what effect do you think these rebates might have among the electorate?
    The idea that the ACA, or any state policy can save money in the long run is just pixie dust. The only effective means of bring about price reductions is consumer pressure based on competition between providers.

    Any temporary rebates, as well as the waivers tend to be political favors more than real savings.

    If when the IBM PC first was introduced, it was lamented that it was far too costly for most households, which was true, a government plan for affordable computers was put in place, we would still be using 640K DOS machines with monochrome monitors and 300 baud modems, paying the same as they cost back then. Instead the competitive market, gives us much more for much less.
  11. 26 Jul '12 16:03
    Originally posted by sh76
    Yeah, well. Unfortunately, it's not that simple. It's not like I'm on a solo plan.
    Which is another reason that employer-based coverage is outdated. All this whining about losing choice - which you never had.
  12. 26 Jul '12 16:04
    Originally posted by normbenign
    The idea that the ACA, or any state policy can save money in the long run is just pixie dust. The only effective means of bring about price reductions is consumer pressure based on competition between providers.

    Any temporary rebates, as well as the waivers tend to be political favors more than real savings.

    If when the IBM PC first was introduced, ...[text shortened]... same as they cost back then. Instead the competitive market, gives us much more for much less.
    According to the CBO it's already saved the country about a hundred billion.
  13. 26 Jul '12 16:08
    Originally posted by normbenign

    If when the IBM PC first was introduced, it was lamented that it was far too costly for most households, which was true, a government plan for affordable computers was put in place, we would still be using 640K DOS machines with monochrome monitors and 300 baud modems, paying the same as they cost back then. Instead the competitive market, gives us much more for much less.[/b]
    Agreed, at times it seems that the significant countributions of private industry is systematically ignored.
  14. 26 Jul '12 19:32
    Originally posted by Kunsoo
    According to the CBO it's already saved the country about a hundred billion.
    And you believe that? This is the promise. We will cover 50 million additional people, cover pre-existing conditions, and people will get better care with less waste, and it will cost less. Does anyone really believe in pixie dust?
  15. 26 Jul '12 21:07
    Originally posted by normbenign
    The idea that the ACA, or any state policy can save money in the long run is just pixie dust. The only effective means of bring about price reductions is consumer pressure based on competition between providers.

    Any temporary rebates, as well as the waivers tend to be political favors more than real savings.

    If when the IBM PC first was introduced, ...[text shortened]... same as they cost back then. Instead the competitive market, gives us much more for much less.
    The only effective means of bring about price reductions is consumer pressure based on competition between providers.

    Yeah, that’s worked.

    “The United States spends two-and-a-half times more than the OECD average health expenditure per person (Chart 1). … Overall, the evidence suggests that prices for health services and goods are substantially higher in the United States than elsewhere. This is an important cause of higher health spending in the United States. … [O]verall the picture about whether the US spends more than other countries because its system does more than other countries is mixed. It does more of some activities, but less of others. Overall, it seems that high prices are probably a more important cause of high spending than high provision of services”

    Source: http://www.oecd.org/dataoecd/12/16/49084355.pdf

    The United States spent 8233 USD on health per capita in 2010, two-and-a-half times more than the OECD average of 3268 USD (adjusted for purchasing power parity).

    “In most countries, health spending is largely financed out of taxes or social security contributions, with private insurance or ‘out-of-pocket’ payments playing a significant but secondary role. The United States which, together with Mexico and Chile, are the only OECD countries where less than 50% of health spending is publicly financed. The public share of health expenditure in the United States was 48.2% in 2010, much lower than the OECD average of 72.2%.
    However, the overall level of health spending in the United States is so high that public (i.e. government) spending on health per capita is still greater than in all other OECD countries, except Norway and the Netherlands. Public spending on health in the United States has been growing more rapidly than private spending since 1990, largely due to expansions in coverage.

    —Though more data would be required, there is at least an implication that post-1990 “expansions in coverage”, while not diminishing the number of uninsured, have also not reduced pricing.

    Source: http://www.oecd.org/dataoecd/46/2/38980580.pdf

    “Health spending is rising faster than incomes in most developed countries, which raises questions about how countries will pay for their future health care needs. The issue is particularly acute in the United States, which not only spends much more per capita on health care, but also has had one of the highest spending growth rates. Both public and private health expenditures are growing at rates which outpace comparable countries. Despite this higher level of spending, the United States does not achieve better outcomes on many important health measures.”

    Source: http://www.kff.org/insurance/snapshot/oecd042111.cfm

    Though this is not the question in the OP—

    “Last year, both the Congressional Budget Office and Standard & Poor's reported that the growth of costs in Medicare has slowed significantly, much more slowly that the growth of costs for private care. … Despite competition and choice in the private insurance system, Medicare spending has grown more slowly than private insurance premiums for comparable coverage for more than 30 years.

    Source: http://www.dailykos.com/story/2012/01/09/1053022/-Medicare-is-still-more-cost-efficient-than-private-insurance

    See also: http://healthaffairs.org/blog/2011/09/20/medicare-is-more-efficient-than-private-insurance/