It’s the time of year again to discuss my least favorite economic subject, the Affordable Care Act, also known as Obamacare.
For the first year since the program began, there is actually some good news. The best news of all is that the only provider here in Robeson County, Blue Cross Blue Shield of North Carolina, has filed for a 4.1 percent rate decrease. That’s right, decrease. This 4.1 percent decrease is an average across the state. BCBS has warned that some counties may actually have increases of up to 10 percent and some counties will have a decrease of nearly 10 percent so we’ll have to wait and see what will actually happen here.
Still, the rates are very high. This 4.1 percent decrease comes after yearly BCBS increases of 14.1, 24.3, 32.5 and 13.5 percent since the ACA became law. BCBS turned a small profit on its Obamacare customers in 2017 after losing $450 million in the three years prior.
Another good piece of news is that no one is required by law to have this insurance or pay a penalty. There were families with a household income of $60,000 or more who were required by law to spend over $30,000 on their health insurance premiums. That requirement is gone. Also, the federal government took in more than $3 billion in penalties, nearly all from lower-income people. That penalty is gone.
If you think about it, though, for most people it made much more sense to pay the penalty than pay the extremely high premiums. People are now free to purchase lower-cost policies that might not include coverage they don’t need, such as pediatric dental care and maternity. So, if you have been covered by an Obamacare policy, it is prudent to shop among non-exchange policies to see if you can save a considerable amount of money and still receive coverage for your situation. If you were “grandfathered” into a policy before Obamacare took effect, BCBS will still offer that policy, so it is likely you should hang onto it since it probably provides more coverage — maybe not pediatric dental, but much lower deductibles and co-pays — for less money.
There are other interesting implications across the state. BCBS reported that the primary reason it could obtain the rate cut is that it was able to extract a large reimbursement cut from the University of North Carolina Health Alliance. Since Duke University Health System and WakeMed Health & Hospitals refused to accept the reimbursement cut, they will no longer be in-network providers for BCBS customers in the Triangle. Consequently, about 50,000 exchange customers in the 12 Triangle-county area will no longer be able to use their same doctors and hospitals, unless they are already in the midst of something like cancer treatment.
Both Duke and WakeMed report that they are trying to work on a solution, so we’ll have to stay tuned for updates. They have more flexibility in making changes this year because the Trump Administration provided relief from some ACA provisions, so Duke and WakeMed can now look across state lines for insurance partners.
Across the country, the Kaiser Family Foundation is reporting that one-third of the states will see rate cuts and the rest of the states are likely to see rate increases below 10 percent. So, nationwide we seem to be settling in to the actual costs of this legislation, which are vastly larger than what the Obama administration experts predicted and assured us.
Surprisingly, I’ve read articles claiming that changes in the last two years have “gutted” (or worse) Obamacare. I think a 4.1 percent rate cut, without being forced legally to spend tens of thousands of dollars, plus the legal ability to purchase a lower-cost policy that covers what someone really needs, is a win-win-win for North Carolina and America.
Eric Dent, a former professor at The University of North Carolina at Pembroke, now teaches at Florida Gulf Coast University.