Tuesday, January 8, 2013

How health insurance exchanges in Obamacare could produce radical change

Let's say you're a small business owner who not only offers health insurance to your employees, but you pick up part of the tab for the premiums. Under our current system, both you and your employees are paying top dollar for that coverage because small group plans are much more expensive than those that are available to large groups (ie, big businesses with lots of employees).

Another thing that is not available to small groups is the ability to offer options to employees. That too is reserved for only large groups. As the business owner, you currently have to buy a one-size-fits-all plan for everyone - regardless of their different situations and needs.

Of course like most Americans, both you and your employees are dependent on the plan the company offers because buying health insurance on the individual market is cost prohibitive.

All of these things change come October this year when the health insurance exchanges are scheduled to open for individuals and small businesses (they'll later be available to everyone).

The really big idea behind the exchanges is that it allows people to buy health insurance as part of a bigger pool and thus will make the costs more comparative to those currently available only to large businesses. So if all works as planned, the cost to both you and your employees should come down as the exchanges grow to cover more and more people.

But what about the idea of opening up options? If rates in the exchanges are the same regardless of whether you're joining as a group or an individual, at some point the question you might ask yourself as a business owner is whether or not its best to continue purchasing a group plan or simply give your employees a set dollar amount and allow them to buy their own coverage as an individual on the exchange. That way they can buy the insurance that best meets their needs.

Perhaps now you're beginning to see how Obamacare might introduce some radical changes in how health insurance works in this country. If this scenario pans out - it would be a GIANT step towards de-coupling health insurance from employment - not to mention increased competition among plans because individuals will have more freedom to chose what they want rather than be dependent on their employer.

To repeat VP Biden's infamous reaction...that's a BFD!!!!

7 comments:

  1. HiSP
    I am not completely convinced that the Repug/traitors actually figured this part out or were they just opposing for the sake of it.

    They kept mouthing the words - freedom, competition, market forces, etc. but is this what they meant?

    Smilingl8dy

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  2. Or the cheap employers will say, "You're on your own, so why give you employees any money at all? The exchange is cheaper, and so it's better for all of us, see?"

    It's what I have long been concerned is the real scenario for those of us with employers who start to think they don't have to offer health insurance to be competitive any longer. It is a race to the bottom in this structure Obama and his friends have passed, as it exults the private sector all around.

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    1. Interesting...so you're saying that it is Obama's fault if greedy employers decide to not pay for health insurance.

      You'd need to then explain what kept them from dropping it prior to Obamacare.

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    2. Employers have been shrinking their available healthcare plans for YEARS.

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  3. I just picked up a precsription that had a copay that was ten cents more than the cost of the medicine. Furthermore, the cost of living raise to my social security allowance was wiped out by a hike in my plan D premium - I now receive $2.30 less per month than I did last year.

    Thank you insurance companies; thank you private sector; thank you free market; thank you corporate greed.

    Oops - did I say thank you? I meant fuck you.

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  4. Health insurance plans need to consider the business implications involved with the launching of public exchanges in 2014. http://www.healthcaretownhall.com/?p=6362

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  5. It is called economies of scale..a very good economic benefit...nothing new..

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