Obama Care – ACA

What is the Affordable Care Act and what does it mean to the average American? This was a bill sponsored by then President Obama and was his signature bill of his administration.

Effectively, it required everyone on American to have insurance. That did not happen as there were no teeth in that requirement. Let’s face it, the task was daunting and there aren’t enough federal employees to check on all Americans to validate that they had coverage or not.

What the bill did do was not considered by the administration and has caused the rise in health care premiums to the point of being unaffordable for many Americans. Ler me explain.

Prior to Obamacare, insurance premiums were relatively law and there were some very good plans available. The most common used example is an under 30 male could get a $1000 deductible with a $3000 maximum out of pocket for around $80 per month. Meaning the most it would cost that person is $4000 in a calendar year. In those days you added the deductible to the maximum out of pocket and that’s the most anyone would pay on that plan during the calendar year.

Today, that plan is considered too rich to be available and those changes is what I want to address. First, prior to Obamacare, the deductible and maximum out of pocket were added together to determine the most you could pay in a calendar year. Today, the maximum out of pocket includes the deductible and is a real out of pocket maximum.

Today, the insurance is totally different and perhaps not in a good way. Let me explain. The plans described above no longer exists and the average deductible is closer to $5000 and the maximum out of pocket is usually around $10,000, or twice the deductible. Double that for a family regardless of the size. Usually, two family members must reach the deductible and maximum out of pocket. After that there are no more charges for the remainder of the calendar year.

Prior to Obamacare, insurance companies could deny you coverage based on specific medical issues, and they did that all the time. Today they cannot deny coverage regardless of your specific medical condition.

The way Obamacare is structured is based on tiers. Platinum is the highest tier and means a 90/10 split (Insurance companies pay the higher amount, while consumers pay the less amount) Gold is an 80/20 split, Silver is an 70/30 split, bronze is a 60/40 split. The higher the metal tier, the higher the monthly premiums and conversely, the lower the tier, the lower monthly premiums. Today. the platinum plans do not exist in Nevada.

What we are left with is mostly high-deductible plans with little or no set premiums. You pay the contracted rate the doctor or facility has with the insurance company. Since those contracted rates are different with each insurance company, you’d have to know what the cost was prior to your visit yet that is not happening, and Americans are very confused as to what their insurance is really paying for services rendered. While inconvenient, it represents today’s health insurance. Consider what is really happening. Insurance has changed dramatically since the advent of Obamacare, and I personally think not in a good way. Yes, people who have severe medical issues can get insurance, but at what price. Insurance premiums have increased yearly since Obamacare and will continue to rise.

Americans need to think about insurance in a different way, meaning its not about the fixed copay any longer it’s about the maximum out of pocket.

Personally, I would take the higher deductible plan available with the lowest premium. Candidly, unless you are hospitalized, you will never reach the maximum out of pocket. Personally, I’d rather have low premiums and not worry about the maximum out of pocket unless hospitalized. Since most do not get hospitalized, it’s a perceived problem, not a real one. Of course, those who are hospitalized end up paying the contracted rates for service which I consider to be whole prices versus the insurance company price which I consider to be the retail price.

The lower premiums allow the average American to buy insurance and not forgo it because they can’t afford it. These are generalizations and not specifics.

I’d buy the least expensive insurance with the highest maximum out of pocket and since we are in Vegas I’d roll the dice on the coverage.

Not the best options but a realistic one that makes sense in today’s insurance world.

I hope this information is useful and if anyone has questions, please contact me via phone or email and I will respond quickly.

Also, you may want to take a look at Medicare 2025 Information. 2026 Medicare Information coming soon.

The Barend Agency Inc.

Len Barend, Broker

Cell:702-250-2200