The Affordable Care Act May Not Be So Affordable
Before the Affordable Care Act (ACA) came into being there was a four tier co-pay plan in place. When the ACA was passed people had to know their insurance plan very well, in order to make the most informed decision about switching healthcare.
While there is a great deal of speculation as to what may or may not replace the ACA, it is clear that it was challenging for many people who were used to the previous health care system. Before it was implemented, the four tier co-pay plan was clear: a set price for Tier 1 (preferred generic) and another price for Tier 2 (non-preferred generic).
When the ACA arrived, Americans had to pay close attention to their insurance plans. Many plans stated generic drugs were at no cost; Tier 2 through Tier 4 did not have a co-pay (only after the deductible is reached). Bronze and Silver plans use a major medical deductible before you get the co-pay for brand name drugs. Many of these changes, however, are proving to be costly for individuals and families.
Tier 3 had a certain dollar amount for preferred brand name drugs and Tier 4 may have had a higher set price or an option of paying 25 percent of a drugs listed price. Some individuals may have had a separate deductible for brand name drugs. Health Savings Accounts were in effect prior to the ACA’s arrival, but there was not separate deductible for brand name drugs.
In or out of network was a hard choice due to the costs. An example would be a woman who chose to go out of network on a Preferred Provider Organization plan (PPO). Once out of the network, out-of-pocket expenses and deductibles double. Put another way, going out of the network not only significantly hiked costs but some services are not covered. This means you pay thousands of dollars for medical care and none of it would be applied toward your out-of-pocket maximum.
All ACA plans must have ten health benefits compared to the “other” system which included seven benefits.
ACA Must Have Benefits:
- Outpatient care
- Emergency room care
- Hospital care
- Prescription drugs
- Recovery services
- Lab work, blood work
- Preventative care
Private (Individual Market) Plan Benefits:
- Outpatient care
- Emergency room care
- Hospital care
- Prescription drugs
- Recovery services
- Lab work, blood work
- Preventative care (a moving target in terms of what is/is not covered)
- Mental health (optional)
- Maternity (optional)
- Pediatric dental (optional)
Many Americans wondered why their costs soared instead of dropped. The answer lies in the way the ACA reform was funded. To fund such changes, there were multiple federally mandated fees (five to be exact) that began to show up on premiums in 2014. The fees were billed to insurance companies and in turn were passed along to the healthcare user.
Will the private, individual market plans return? Would a return to the old system benefit Americans? Would a blend of the old and new systems work best? Only time will tell.