Elementary Question- What Was the Purpose of Mandated "Essential Health Benefits"?

[VolAgent]

Sorry, but difficult for me to agree with you completely. Yes there were many people who purchased less than adequate coverage, but that was their choice. With all the regulation around marketing, I find it hard to believe that those who enrolled did not have the information needed to understand what they were buying. Sure, there there some who did not understand, maybe many, but it was their responsibility. And keep in mind, ACA proponents will tell you that it solved the problem of people getting access to healthcare. We all had access to healthcare prior to ACA.

I have a lot of respect for you Lee. You really know health insurance. But on this, I have to disagree with you. If they were truly capable of understanding health insurance and how it worked, they wouldn't be working at Denny's for under $10 an hour.

And if people were truly capable of understanding insurance, why do we need agents? The biggest value of an agent is explaining things in a language you can understand and helping you avoid pitfalls like this.

So no shame on the Denny's employees who signed up because they didn't know better. Shame on the insurance company and agent for representing this to them as real health insurance. And shame on the HR people who agreed to offer the plan to their employees.

 

[Ann H]

The problem is the difficulty of understanding a complicated financial product, options, and the cost.

If the cost was $80 for real insurance, and you had a lot of options, Denny's would not promote a bad plan for $70 instead of a good plan for $80.

When the price is $300, and there are few options, it's a problem.

The young, uneducated and vulnerable segment will always need help understanding insurance, finance, credit, etc. They flock to payday loans because they don't really understand and like they feel they have few options.

The ACA proponents thought they would make it "as easy as buying a plane ticket", with the counsel of navigators & hc.gov, with options all in one place, and with lower net cost. It was an attempt to solve root issues, and I'll credit them for that. They just failed miserably at it. Even calculating the net cost took an accounting class and the ability to predict the future. Crazy stuff.

 

[Josh]

The young, uneducated and vulnerable segment will always need help understanding insurance, finance, credit, etc. They flock to payday loans because they don't really understand and like they feel they have few options.

What the heck does age have to do with it? Payday loans and the like have a lot more to do with class and intelligence than age or education.

This girl at Denny's wasn't just young, but as politely as I can put it she was simple. Despite that she actually did show that to me because I was doing a Medicare presentation there so she was looking for help.

Again, I'm neither a fan of big government nor the ACA, but there were a LOT of really bad products being offered as "insurance" and a lot of people thought they were covered when they weren't.

 

[somarco]

As Lee said, the problem is not the agent but the insured's lack of understanding. There have been many employers with numerous low-skilled an unskilled workers who wanted some form of health insurance. In those situations the employer offered a plan that was, as some here have said, is better than nothing.

Personally I disagree with that premise but that is for another discussion.

A few years ago I picked up several employees that worked for a government contract facility. They worked for the contractor, not the govt entity. Work was repetitious (mostly data input) and did not require a lot of skill.

Someone had a large hospital claim and when they discovered how little their plan paid they called me, hoping I had a policy that would "pick up the difference" in what was billed and what their plan paid.

Of course there is no such thing, but she appreciated my help and dropped her employer plan to buy a plan (real insurance) from me.

She also told several co-workers and some of them bought as well.

A quick read of the employer summary was clear that the plan was indemnity, not true major medical. The wording (taken from carrier literature) was misleading at best but conveyed warm fuzzy feelings and only costs about $60 per month.

Like other limited insurance plans they are great until you need them for something major.

 

[leevena]

I agree with all of you, in fact I said in my post that some were confused. But there are a variety of ways to get information and make an informed decision, this is health insurance, not rocket science. If people purchased without putting out a little effort to learn more, well too bad.

I will meet them half way and recommend a participation trophy for them

 

[Josh]

this is health insurance, not rocket science.

Relative to the education/intelligence of a large percentage of this country, it might as well be rocket science.

If people purchased without putting out a little effort to learn more, well too bad.

Again, I don't think you understand at all the segment of the population I'm referring to. I'd be willing to wager that half the insurance agents on here don't really understand their car insurance and these are professionals with insurance licenses.

I will meet them half way and recommend a participation trophy for them

Again, I think you're being incredibly dismissive about the level of understanding probably 20% or more of this country is capable of. If anyone has started a new job they hand you a mountain of paperwork and new hires get confused about even getting their deductions correct. Now add that to someone that barely passed high school and is taking whatever job they can get, buy getting what by all accounts to the lay person seems like health insurance, they actually could reasonably think they're being responsible.

Ever buy a house? With all the ways they add fees in it just understanding what your real APR was took a lot of heavy math. A lot of that changed with the TIL act and it's on one sheet now, but if you got a mortgage before that it was really easy to get confused and pay a much higher APR because of the clever ways the fees got buried.

Back to buying a house, did you know that in most (all?) states you can negotiate getting a part of the real estate agents commission? Probably not.

I'm sure with more time and thought I could think of a lot more examples, but the bottom line is that a large part of the population really is easily misled/confused and these "insurance" plans did put them at huge risk when they thought they were covered.

 

[leevena]

Relative to the education/intelligence of a large percentage of this country, it might as well be rocket science.

Again, I don't think you understand at all the segment of the population I'm referring to. I'd be willing to wager that half the insurance agents on here don't really understand their car insurance and these are professionals with insurance licenses.

Again, I think you're being incredibly dismissive about the level of understanding probably 20% or more of this country is capable of. If anyone has started a new job they hand you a mountain of paperwork and new hires get confused about even getting their deductions correct. Now add that to someone that barely passed high school and is taking whatever job they can get, buy getting what by all accounts to the lay person seems like health insurance, they actually could reasonably think they're being responsible.

Ever buy a house? With all the ways they add fees in it just understanding what your real APR was took a lot of heavy math. A lot of that changed with the TIL act and it's on one sheet now, but if you got a mortgage before that it was really easy to get confused and pay a much higher APR because of the clever ways the fees got buried.

Back to buying a house, did you know that in most (all?) states you can negotiate getting a part of the real estate agents commission? Probably not.

I'm sure with more time and thought I could think of a lot more examples, but the bottom line is that a large part of the population really is easily misled/confused and these "insurance" plans did put them at huge risk when they thought they were covered.

Agree about understanding capabilities, but I said they should ask for help.

And you my friend are the receipient of a participation trophy!

 

[GreenSky]

I didn't read the part of the Constitution where the government needs to step in because people don't understand what they're buying. I'm ok with requiring a summary of benefits that is short and understandable.

I'm pretty sure people don't understand how often they need to change their oil but I don't want government mandatory oil changes.

I'm tired of hearing about how the government must make decisions for all of us because a minority is too stupid to understand on their own. Although I'm sure the socialists on this site will (and have already posted that they) disagree.

BTW, this is why government schools suck. They dumb everything down for the slowest children and still give them a participation trophy.

Rick

 

[VolAgent]

Agree about understanding capabilities, but I said they should ask for help.

And you my friend are the receipient of a participation trophy!

So, how many employees call an agent to ask about their health insurance from work? How many agents would have even taken the time to review it with them?

Businesses are getting sued, and losing, over their 401ks for this very issue. The business made a very poor 401k available to their employees. It isn't the job of the employee to decide what benefits the employer offers, it is the employer's.

 

[somarco]

I am glad you introduced 401k's into this thread.

For many years employers that offered retirement plans picked the investment vehicle. Often it was conservative, such as a group annuity or maybe a separate account with low risk blue chip stocks.

Then employees complained that THEY should have options and be allowed to make their own decisions.

So employers complied with a smorgaboard of investment options and the ability to move money from one fund to another at different times of the years.

Most employees are like the majority of the public and are not disciplined investors. They buy and sell on emotion, not advice or self study. So they end up buying high and selling low.

Then they complain because there is not enough money in the fund when they are ready to retire.

Part of that is because they borrowed from the fund while working. When they leave the job they can't pay off the loan so they take the tax hit.

This is not limited to those that are uneducated. There are plenty of people out there with degrees that cannot or will not take even a few minutes to study their options before making a choice.

State employees in Georgia have their health insurance through the SHBP (State Health Benefit Plan). In 2014 the plans changed dramatically to comply with Obamacare. Of the half a dozen choices, none included a copay plan.

Literally hundreds of teachers made their election without realizing the plan they chose did not have a copay. Only when they used their plan in January did they realize they "could not afford to go to the doctor" because they did not have a copay.

They complained, set up a Facebook page and got the media involved. Eventually the state caved and restructured several of the plans to offer a copay . . . retroactive to the first of the year.

This meant refiling claims all because teachers did not do their homework.