Buying health insurance is tough enough for anyone. It’s hard to slog through the terminology. You have to ponder the unknowns about next year’s illnesses and make your best guess about the coverage you’ll need. Add in the hassle of navigating the new state shopping exchanges, and you’re facing one of the most complicated shopping decisions ever.
Given the complexity of this task and the cranky website, www.healthcare.gov, it’s no wonder the federal government reported that only 137,204 people across the country actually had selected an insurance plan through a federal exchange from Oct. 1 through Nov. 30. In Colorado, which runs its own exchange, about 10,000 people had chosen a plan.
Figures from government number crunchers, though, don’t tell the whole story. What is it really like to sign up and make a choice? To find out, I’ve been following a 59-year-old Hastings, Neb., woman who began her quest for insurance to cover her daughter and husband weeks before www.healthcare.gov opened for business. (She receives Social Security disability payments for a back injury and is covered under Medicare.)
The woman we’ll call Marilyn — she didn’t want her name used — was a model shopper, and she did a lot of homework. She attended an AARP educational meeting, called insurance companies, got her name on www.ehealthinsurance.com and had dozens of agents contact her. She called Blue Cross Blue Shield, her family’s current carrier, and investigated a new competitor CoOpportunity, one of the co-op arrangements that the law allows.
Marilyn had a lot of questions about that company. “I liked the nonprofit idea,” she said. “It cuts out the middle man and that provides the savings.” Since it was a new company she had not heard of, she needed assurances that the carrier would be around to pay claims. The sales agent told her it was affiliated with a company in Minnesota that had millions of dollars behind it.
Like other Americans, Marilyn struggled with www.healthcare.gov. Early on, she tried to create an account and could not. Persistent, she called the government’s 800 number and was told to complete a paper application. She did that, but found many questions confusing, such as the one asking if she wanted the government to automatically check her eligibility each year.
She called the government 800 number once again to learn more. She was kept on hold for 20 minutes during the first call, and never got an answer. On the second try, she did get an answer. “Some of the operators knew a little more; some a little less, but their command of the information was not what it should be,” Marilyn observed.
After about four weeks, she learned her husband and daughter were eligible for a family tax credit of $233 to help buy a policy. Throughout November and into December she checked out the particulars for Blue Cross bronze and silver policies and for similar plans from CoOpportunity. Bronze policies, usually the cheapest, cover 60 percent of the policyholders’ medical costs; silver plans cover 70 percent.
Blue Cross offered a bewildering number of bronze plans — eight to be exact — with different deductibles and amounts of coinsurance and varying out-of-network benefits. CoOpportunity’s plans also were confusing.
In mid-December, Marilyn told me the process was “getting crazier by the day.” She had just gotten a call from a government representative in Kentucky who told her to call the 800 number. Marilyn called and learned her family’s subsidy would be only $141 because her daughter might not be eligible for an exchange policy. Healthcare.gov was sending her application to Nebraska Medicaid to see if her daughter qualified for Medicaid coverage instead.
(Many states are requiring exchange applicants to try Medicaid first to see they qualify for that program, which, of course, adds another layer of complexity.)
Marilyn, who had worked as a mental health therapist, knew the pitfalls of Medicaid. Providers move in and out of the program. Medicaid drops coverage when people no longer are eligible. She doubted whether her family income would qualify anyway. “I was fit to be tied,” she said.
The next day, Marilyn and her husband decided that the small tax credit was not worth buying an exchange policy, and they opted for a non-exchange policy to avoid the pain of dealing with Medicaid. A low premium was at the top of their must-have list.
They could keep their current policy, which was grandfathered under the law, but the premium might go up 16 percent in January to $862, a steep increase. They could get a new Blue Cross plan that complied with the benefit requirements of the health law, or they could find a policy from another company.
They weighed the pros and cons and looked at the key trade-off — paying more up front and less when they needed medical care or paying a lower premium and more in the form of coinsurance and copays when they got sick.
They chose a Blue Cross high deductible bronze policy with a premium of $569. There was one more choice to make. Instead of an “aggregate” deductible, which meant the higher family deductible would apply before benefits could be paid, they could pick an “embedded” deductible with each family member paying $6,325 before insurance kicks in. Then the policy would pay for everything.
The family had run smack into the realities of the new marketplace. “The tax credit won’t mean much when you have such a high deductible,” Marilyn said. “When people find out about the nuts and bolts, they are going to be pissed.” She summed up her experience in one word: "disappointing.”
Others may have better experiences as www.healthcare.gov improves and customer service reps become more knowledgeable. The bottom line remains: Being a good shopper for health coverage is just plain hard.