“Here’s what you need to know…” style=”default”]
- Health care rationing distributes scarce, rare or costly services by price
- Obamacare provided a range of essential benefits at no additional cost to consumers
- Prior to the Affordable Care Act insurance companies rationed health care
- Obamacare does not require or encourage health care rationing
- Obamacare reduces health care rationing
Obamacare promotes preventive care and wellness as principles for reducing long-term health costs, expenditures, and improving health in the United States. In a rationed medical care system, demand and other factors determine the availability of services, and pricing reflects scarce or rare services that require higher payments from consumers. Prior to Obamacare, insurers were free to reject or accept applicants based on ability to pay, and charge higher prices and premium surcharges for services as they chose.
Obamacare brought many reforms including fair pricing and required services categories. Obamacare prohibits price discrimination against consumers except for tobacco use, location, and age. Compare health insurance rates now by using our FREE tool above!
Rationing Health Care
There are many forms of rationing in health care when considered as a resource for the entire nation. In the private sector, pricing is a method for rationing health care. Insurance prices exclude those with too little income to afford private plans. Obamacare requires a minimum level of income and that it is above the federal poverty line.
Obamacare expanded Medicare so that states could increase the number of persons qualified to receive low or no cost care.
Rationing includes emergency services outside of Medicaid that can have long waiting periods and high ratios of patients to available medical personnel. Long-waits, queues for services, and waiting lists are forms of rationing too.
Premium Assistance and Rationing
Obamacare adds premium assistance to make insurance more affordable for millions of subscribers. The system permits taxpayers to use advanced tax credits to reduce the monthly payout for premiums. This feature of the ACA reduces the impact of price rationing. People with lower incomes can afford policies that would otherwise only go to those with higher incomes.
Employer Provided Policies
Employers ration health care by decisions they make on the content and costs of employee health insurance programs. When costs exceed 9.5 percent of employee annual income, they are no longer affordable and the employer may have to pay a penalty. Employer’s traditionally provided luxurious policies for some employees and the ACA penalizes this practice with a tax penalty.
Shopping Outside of Obamacare
Comparison shopping is particularly important for those near the top of the eligibility scale for premium assistance. It is imperative for these consumers to shop outside of healthcare.gov and the state exchanges.
These consumers benefit from comparing policies that do not provide subsidies since their levels of subsidy are low to non-existent.
Comparison shopping enables a more informed analysis than merely looking at prices. One can assess the features that have greater importance and costs impact than others.
Preventive Care and Wellness
Preventive care is an approach that reduces price rationing. Preventive care emphasizes early detection of severe diseases. This practice provides opportunities to reduce the incidence of severe illness by treating it in early stages or preventing it completely. Wellness has a similar idea; it finds individuals in symptom-free status and designs actions to maintain good health.
Increasing Insurance Coverage
Obamacare’s primary goal was to cover the millions of uninsured Americans. This policy expands access to medical care and reduces rationing based on price. This primary goal had several aspects. It included new benefits and protections for all insured persons and no cost benefits for Medicaid and Medicare beneficiaries. No-cost benefits increase the likelihood that beneficiaries will use medical services and that they will not put off needed medical care.
Price Discrimination
Obamacare requires insurers to offer insurance to consumers on an equal basis without rationing. The law prohibits rationing by variables such as gender, and pre-existing medical conditions. Obamacare limits insurance discretion when deciding prices. The law permits price discrimination by insurers in a limited number of circumstances that reflect fundamental policies. Insurers can discriminate when pricing policies on the following conditions.
- Age: Insurers can ask the age of applicants and base insurance prices on age, generally charging more for advanced age.
- Location: Insurers can use location as a price determination factor when preparing and offering plans on healthcare.gov and state insurance exchanges.
- Smoker/non-smoker status: Insurers can ask about smoking habits and charge additional premiums for those who use tobacco products.
Fewer People Delay Treatment
Delays in treatment are signs of medical care rationing. High prices discourage or prevent consumers from using needed services. Obamacare enrolled many more people and increased access to medical services for Medicare and Medicaid recipients. Under Obamacare, millions of subscribers get basic medical care at no extra charge. These include screenings, annual physical exams, and supporting services like laboratory work. Basic services include addiction treatment and maternity and early child medical care.
Affordable Care Act and Rationing
The law requires coverage under the individual mandate; however, it allows an exemption when coverage is not affordable. Affordable health insurance coverage has a cost determination. Affordable coverage may not cost more than 8 percent of annual income, and no more than 9.5 percent for employer-provided coverage.
The affordable care limit and exemption rations health care by removing a legal requirement when insurance costs too much.
By exceeding the maximum percentage of income allowed by the ACA, the Congress made a determination to ration medical care by a combination of costs and scarcity. Obamacare provides consumer choices aimed at reducing price rationing. By using actuarial value, Obamacare divides policies into four types. Each type has a consistent ratio of consumer paid costs and insurer paid benefits. While many consumers regard deductibles as too high, they would be far higher without costs controls from federal and state regulators and price competition on local markets.
Types of Obamacare Plans
Obamacare uses plan types to reduce price rationing. The types are broad categories of value determined by actuarial analysis. The types offer a wide variety of terms, features, and deductibles. The below-itemized listing of plan types describes the costs impact on consumers.
- Platinum Plans cover 90 percent or more of the policy’s essential benefits leaving ten percent or less for consumer payments.
- Gold Plans provide coverage 80 percent or more of the essential benefits; they leave 20 percent or less for consumer payments. Gold plans have high premiums and moderate deductible limits.
- Silver Plans pay 70 percent or more of covered essential benefits leaving 30 percent or less for consumer payments. Silver plans can accept health savings accounts which provide tax deductions and funds for deductible costs and out of pocket expenses.
- Bronze plans pay 60 percent or more of costs of the essential benefits offered in the plan. The consumer pays 40 percent or less. These plans typically have the lowest premiums and the highest deductibles.
Costs Reduction in Obamacare
Costs are a major impediment to getting the needed medical care. High deductibles, coinsurance, and co-pays are factors that affect consumer behavior. These costs are financial obstacles; they are price-based barriers that can inhibit medical care. Obamacare offers payment assistance and health savings accounts as tools for controlling costs.
Medical Care Rationing and Obamacare
Comparison shopping helps take best advantage of plans and coverage. By focusing on plan features of greatest importance to the individual or family subscriber, comparison shopping reduces the impact of medical care price rationing. The best answer for every consumer may not be among the qualified health plans on the Obamacare Marketplaces. While Obamacare is the only source of premium assistance and payment assistance, the best plan may be outside the system, and revealed by comparison shopping. Enter your zip code in our FREE tool below to get health insurance quotes instantly!