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#ADVANTAGE: What’s the Long Term Price-Tag of Medicaid Expansion? (8/9/2014)

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Welcome back to another edition of our #Advantage blog segment. This is where we answer the questions that we get on social media. As some of you know, our official Twitter hashtag is #Advantage and you can catch up with us here: www.twitter.com/Advantage (or at @Advantage).

This week we had a question from Jill Pederson (@Jill_Ped) up in Oregon. If you’ve followed healthcare reform closely, you’ll know that Medicaid programs were significantly expanded because of the Obamacare law. Expansion is based on FPL (or Federal Poverty Level). Here was Jill’s question:

Let’s start with a short history: back in the summer of 2012 the Supreme Court of the United States upheld the “individual mandate,” and also ruled that individual states have the option to either “opt in” or “opt out” of expanding their state Medicaid program. As of 2014, 27 states (including the District of Columbia) have expanded their Medicaid programs. That’s over half of the nation (here’s a great infographic from Families USA). 

The question is: What’s the long term price tag of Medicaid expansion? Well if you know much about Medicaid, you’ll understand that it’s a joint state/federal program. So depending on the state you’re in, the price-tag is going to vary… sometimes considerably. Here two of the bigger common factors that will affect costs:

  • Utilization of the Medicaid program (ie: the number of people eligible for Medicaid in your state).
  • Whether-or-not your state decided to expand Medicaid under the federal reform law.
  • …plus others.

And if you’d really like an in-depth explaination, here are the details from the Kaiser Family Foundation: Why does Medicaid Spending Vary Across States: A Chartbook of Factors Driving State Spending. The Kaiser Family Foundation utilizes the “Urban Institute’s Health Insurance Policy Simulation Model (HIPSM)” to provide national and state-by-state estimates of the impact of the ACA on federal and state Medicaid costs.

Here’s the answer to Jill’s question regarding the long-term price of Medicaid for individual states (based on HIPSM’s model): “The Medicaid expansion and other provisions of the ACA would lead state Medicaid spending to increase by 76 billion dollars over 2013-2022 (an increase of less than 3%). Some states will reduce their own Medicaid spending as they transition already covered populations to the ACA expansion.” 

It’s the federal government that’s going to take on most of the bill regarding the expansion. The federal government will pick up 100% of the cost of covering people made newly eligible for Medicaid during the first three years (2014-2016), and no less than 90% on a permanent basis. According to the same HIPSM model:  “Federal Medicaid spending (from 2013-2022) would increase by 952 billion dollars (a 26% increase).”

Here are four important points:

A) What do the proponents of Medicaid expansion say?: Those in favor say that it will reduce the amount of uninsured people, while reducing costs. Many formerly uninsured will be covered, and the general public will take on less of a burden when having to compensate for unpaid medical bills of the uninsured.

B) What do the opponents of Medicaid expansion say?: Those opposed say it’s too expensive, over-reaching, and unaffordable. In order to pay the bill (especially at the federal level), taxes will have to go up. Additionally, some are still skeptical about whether-or-not raising taxes will even be enough to pay the bill.

C) What’s going to happen?: That’s the billion dollar question. Obviously you can speculate, but you can’t predict the future. Optimistically you want to say it’s going work, but technically is still “TBA” (To Be Announced).

D) What IS happening?: Generally speaking, those states that have expanded Medicaid in 2014 are seeing some short-term success. The question though is long-term: will it be affordable and sustainable? Again, TBA.

Thanks for stopping by at our “#Advantage” blog segment dedicated to questions from our social media friends. We hope you found our information to be valuable.

We’ll continue to roll-out answers as questions come in. Don’t forget to hash-tag “#Advantage” at Twitter, and visit our official tag here: www.twitter.com/Advantage.

Check back at our blog to get further information about funding healthcare. Also, please share with your friends, clients, colleagues, and family. Here are a few of our other information outlets:

Home Page: https://policyadvantage.com

Twitter: http://www.twitter.com/policyadvantage

Facebook: http://www.facebook.com/policyadvantage

YouTube: http://www.youtube.com/policyadvantage

Pinterest: http://www.pinterest.com/policyadvantage

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#ADVANTAGE: Does Healthcare Reform Make Health Plans Cheaper? (4/24/2014)

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We’ve recently created a blog segment called “#Advantage” where we’ll answer the questions that we get at Twitter. Our official Twitter hash-tag is #Advantage, and we’ll explain this in further detail in a future blog post. For now, you can find additional information at www.twitter.com/advantage (or @advantage).

Our 4/24/14 question was from “CA Medicare Assist” (@MedicareInCA) in Santa Rosa, California. The question was this:

Does healthcare reform make health plans cheaper? (see the official Tweet here) 

“CA Medicare Assist” (@MedicareInCa) mentions that this is the #1 question they’re asked. And… it’s a good one. Check out the answer below the tag.

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The answer is: In certain cases, yes it does. Healthcare reform can make health plans “cheaper” for certain policyholders. However, there are some additional important details that should be considered. Here are the questions that are raised:

  • How are these health plans made cheaper? Plans are made cheaper via “Advanced Premium Tax Credits” at public health insurance exchanges like Covered California. APTCs are commonly known as the “subsidies” that you hear so much about. These subsidies are applied to individual health insurance premiums to make them more affordable.
  • Who are these health plans made cheaper for? Health plans are made cheaper for individuals and families that fall between approximately 100% and 400% of FPL (or Federal Poverty Level). For individuals, this is about $11,000 to $45,000 per year in gross income.
  • Are health plans made cheaper for everyone? Nope. In fact, for many of those who fall outside of 100% to 400% of FPL (or individuals making more than about $45,000 per year), health plans can actually get more expensive in a lot of cases.
  • How are the subsidies that make these plans “cheaper” funded? These new subsidies are funded from a variety of different sources, mostly in the form of taxes. Here are a few of them: A) increasing the Medicare tax on high-income households, B) taxing high-cost medical plans, C) penalties for those who don’t get coverage, D) employers paying if they don’t provide coverage, E) new fees on the health industry, and certain others.

Thanks for stopping by at our “#Advantage” blog segment dedicated to questions from our followers and others. We hope you found our information to be valuable.

We’ll continue to roll-out answers as questions come in. Don’t forget to hash “#Advantage” at Twitter, and visit our official tag here: www.twitter.com/advantage.

Check back at our blog to get further information about funding healthcare. Also, please share with your friends, clients, colleagues, and family. Here are a few of our other information outlets:

Home Page: https://policyadvantage.com

Twitter: http://www.twitter.com/PolicyAdvantage

Facebook: http://www.facebook.com/PolicyAdvantage

YouTube: http://www.youtube.com/PolicyAdvantage

Pinterest: http://www.pinterest.com/PolicyAdvantage

Word Press: http://www.policyadvantage.wordpress.com

 

5 Reasons to “Give Yourself the Advantage”

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There are a lot of great reasons to put a health benefits broker to work for yourself or your company these days. As health insurance planning (and the health benefits industry in general) continues to grow more complex… having an informed, knowledgeable, and up-to-date adviser on your team can be a really big advantage.

Here are 5 great reasons to “give yourself the advantage” today:

  1. Healthcare Reform is Fast Approaching: The major portions of healthcare reform (ObamaCare, ACA, the Affordable Care Act, or whatever you want to call it) are quickly approaching. We can’t emphasize this enough. Although it will take years to implement (and there will no-doubt be changes), you’ll want to make sure that you have a good understanding about what is coming up in 2014 (and beyond). Whether you’re an individual or business, if you “miss the boat,” it could end up costing you a lot of money. Contact us with questions today. **Update 1/1/2014: Healthcare reform is here.
  2. Health Insurance and Health Benefits are Complex: As the health insurance and health benefits “system” continues to grow larger, navigating this landscape can become an increasingly burdensome chore for the typical consumer. We’ve got great news for you: we know this industry well, and can help you navigate it. There’s not a better feeling than having an informed friend on your side, helping you with the ins-and-outs. Just check our growing list of customer testimonials.
  3. Save Money and Improve Coverage: Yes, you heard that right. Individuals and business owners take note: with just a few simple adjustments to your current program, you may be able to improve your coverage, and save money at the same time. How’s that for a home run? Having someone in your corner (who knows the industry well) can help you accomplish this. Consider it a “tune-up” for your health insurance program, free of charge. Example: a minor adjustment with a tax incentive here, then a simple adjustment to a physician network there… and boom. You’ve got better coverage at a cheaper price. Granted, improvement doesn’t happen every single time, but in many cases, it’s possible. Contact us to help you look it over.
  4. Valuable, Up-to-Date, Relevant Information: This is one of our big areas of emphasis at Policy Advantage Insurance Services. We know this industry changes. Sometimes quickly. We stay up-to-date with the information that we provide using a number of different strategies. The two big ones: A) Professional Designations (ie: the RHU®/Registered Health Underwriter® and REBC®/Registered Employee Benefits Consultant are the undisputed professional credentials in our industry). B) Information from our partnerships and affiliations (ie: insurance companies, third party administrators, and educational institutions). Companies like Kaiser Permanente, Cigna, United Healthcare, and others are constantly providing us with fresh information that we get out to our client base and readers. We take great pride in providing you with up-to-date info.
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  1. Insurance Company Choices and Options: With a broker, you don’t just choose from one insurance company, you get to choose from many. A broker is like an “insurance store.” This can be very important for a number of different reasons. Physician and hospital networks vary from insurance company to insurance company. Insurance premiums may also vary. The structure and the way that managed care organizations (or MCOs) operate  can also vary considerably. These are all good reasons why it’s a good idea to give yourself some choices when it comes to health insurance companies.

As you can see above, you can “give yourself the advantage” today. Our number one priority are our clients and customers, and helping you navigate the complex world of health insurance and health benefits.

Thanks for stopping by, we hope you found our information to be valuable. Check back at our blog to get further information about funding healthcare. Also, please share with your friends, clients, colleagues, and family. Here are a few of our other information outlets:

Home Page: https://policyadvantage.com

Twitter: http://www.twitter.com/PolicyAdvantage

Facebook: http://www.facebook.com/PolicyAdvantage

YouTube: http://www.youtube.com/PolicyAdvantage

Pinterest: http://www.pinterest.com/PolicyAdvantage

Word Press: http://www.policyadvantage.wordpress.com