Wednesday, October 16, 2013

The Major Problem With Obamacare

I am a health insurance broker in California and feel qualified to speak about the reality of Obamacare in my state.  The entire success of this program is based on enough healthy young people signing up to offset the high cost of managing the health of those with diseases requiring expensive treatment.

Here are FACTS from my state.  Prior to Obamacare, the premium range for a 30 year old Californian was $75 to $150 per month for coverage geared to a healthy young person.  Even at these reasonable premiums, many of these "young invincibles" did not sign up, as they simply felt they were healthy and would rather pay this money for recreational purposes rather than health insurance.

I just ran Obamacare premium quotes for a 30 year old in Orange County earning $30,000 a year which entitles this person to a premium subsidy.  I feel this income level is average for my state.  The cost range of plans available to this 30 year old ranges from $146 to $213 per month.  The $146 plan includes a $5000 deductible, $70 doctor copays limited to 3 visits per year, $120 urgent care copay, and $19 for generic drugs, some of which can be purchased at Costco for as low as $4.

Running a quote for this same 30 year old at today's 2013 pricing, I can sign him up for a $3,500 deductible plan with $40 doctor copays, $15 generic Rx and the same no charge preventive care as with an Obamacare plan for $94 per month.  He would also have the option to go to a $6,500 deductible at $75 per month.  These plans will not be available in 2014, as they do not meet federal mandated coverage standards.  Therefore, I do not see many of the "young invincibles" rushing out to buy Obamacare.

This program is doomed to fail because a group of politicians with egos put together a flawed attempt at healthcare reform.  I am a huge advocate of healthcare reform, as the cost of healthcare in this country is waaayyyy out of control.  However, this particular plan in its current foremat has two chances, slim and none. What needs to happen here is that this fiasco needs to be delayed until the appropriate people including physicians, businessmen, insurance industry people, minority group representation, middle class representation and others can meet behind closed doors for as long as it takes to fix this.

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