One of the health care overhaul’s most far-reaching provisions prohibits health plans from refusing to cover people who are sick or charging them higher premiums. Still, for people with serious medical conditions, the online insurance marketplaces present new wrinkles that could have a significant financial impact.
Obviously, premium costs will be an important consideration for consumers. But just as important will be a realistic assessment of the kinds of out-of-pocket costs they could expect with different types of policies and subsidies for which they will be eligible.
“Everybody should be factoring in cost sharing along with the premium to try to assess what their total financial exposure is,” says Jennifer Tolbert, director of state health reform at the Kaiser Family Foundation.
The cost and coverage implications are especially critical for people with high medical expenses. Choosing a higher monthly premium rate for so-called platinum or gold plans may be a better buy than choosing the less-expensive and less-comprehensive bronze or silver plans.
For example, even though the premium for a platinum plan will generally be higher than that of a bronze plan, the out-of-pocket spending cap may be significantly lower since platinum plans must cover 90 percent of expenses. In California, for example, the out-of-pocket spending limit on a platinum plan is $4,000, compared with $6,400 for other the other “metal level” plans.
For people who expect to hit their spending cap ($6,400 for individuals and $12,700 for families), buying a pricier platinum plan may actually result in lower total spending, says Marc Boutin, executive vice president and chief operating officer at the National Health Council, a patient advocacy organization.
“It’s counterintuitive,” he says.
Insurers anticipate that people with high medical costs will gravitate toward platinum and, to a lesser extent, gold plans, and these commercial companies are pricing those plans accordingly, say experts.
If only one member of a family has high medical expenses, families may want to consider splitting coverage between different plans.
“Many insurers are expecting that savvy families will enroll a sick family member in a platinum plan and the rest in lower level plans,” says Tolbert.
Depending on where people live, that strategy could run into snags. Although splitting family coverage is allowed on the individual market, state and federal officials say the Department of Health and Human Services is considering whether to limit the practice on the exchanges it will run in 34 states next year, as are some states setting up their own exchanges. That includes Florida.
Also, platinum plans may not be available in every state.
A platinum plan may not be the best option in any case, even for people with expensive medical conditions. Although premium tax credits are available for any type of plan, cost-sharing subsidies that can substantially reduce deductibles, co-payments and coinsurance are only available on silver plans.
In addition to how much the plan costs overall, people with serious medical conditions need to carefully review whether the drugs they take are on the plan formulary, and the specialists and facilities they visit regularly are in the plan’s network, say experts, as well as their out-of-pocket costs to go out of the network.
“People need to do an honest assessment of their needs, and determine what’s on their ‘must have’ list,” says Kirsten Sloan, senior director of policy at the American Cancer Society’s Cancer Action Network.
Kaiser Health News (www.kaiserhealthnews.org) is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.