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A new kind of healthcare?

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What if health insurance was similar to that of reserving a rental car?

You sign on to a Web site, answer a few personal questions about your current age, home address, family, income and more. Then the site supplies a list of plans, insurers and an accompanying list of plan prices and benefits – all the consumer needs to do is pick one from the list and sign up.

That’s essentially how a health benefits exchange works. This time, next year, under the national health law, people with low to moderate incomes will be able to purchase individual plans that will start in 2014. There will also be exchanges for small businesses.

A closer look at the exchange for individual plans:

Each plan rated based on price and quality.

Plan is required to make public disclosures including but not limited to finances, denied claims and enrollee rights.

Tax credits and other government assistance could help those that meet income guidelines but that don’t have access to other affordable coverage to receive lower premiums and out-of-pocket costs.

A program intended to educate people about the exchange would also be available.

Patient Protection and Affordable Act

The Act calls for exchanges in each state. Although anyone can use them to shop individual plans, they are intended to assist uninsured people who earn too much to be eligible for Medicaid, yet struggle to afford coverage. Exchanges also enable smaller employers to offer insurance to their workers.

According to estimates from the Congressional Budget Office, by the year 2019, 24 million people will buy individual plans through an exchange, along with 5 million employed through small businesses.

In Virginia (VA), by 2014, an estimated 283,000 people and 232,000 small business employees could participate in exchanges, says the Urban Institute.

Gov. Bob McDonnell has dodged his preference for Virginia, saying “A lack of information from the federal government makes it difficult to commit to a state-run exchange.”

While there are many pros to exchanges, consumers are concerned about higher premiums. Steve Cindrich of Optima Health says, “He is concerned that the federal subsidies won’t do enough to make plans affordable and as such consumers will opt out and pay the penalty tax for remaining uninsured.” The marketplace needs broad participation by insurers and consumers, to succeed.

About the Editors: The Shapiro, Lewis & Appleton personal injury law firm, whose attorneys work out of offices in Virginia (VA) and North Carolina (NC), edits the injury law blogs Virginia Beach Injuryboard, Norfolk Injuryboard, Eastern Shore Injuryboard, and Northeast North Carolina Injuryboard as a pro bono service.

10 Comments

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  1. jc says:
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    This is the biggest boondoogle the government has ever gotten involved in. But the American public voted for it and now we are stuck with Obamacare. It is a pipe dream to expect 32 million people to get health insurance and only a few millionaires have to pay higher taxes. This will take a river of money and the middle class is gonna get hit with higher taxes to pay for it. The only people who really benefit from it are the plaintiff lawyers.

  2. jc says:
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    Lets talk for a moment about Obamacare subsidies. If we mandate that everyone have health insurance than some people have to get subsidies to pay for health insurance. Below 35K/year the family is on welfare (Medicaid). But the premiums for health insurance for a family of 4 is about 20K/year. Someone making 36k is going to get a full subsidy. That subsidy will fade out to 0 by the time a person makes 95K. So between 35K and 95K a family of 4 will get a sliding subsidy to help them pay a 20K health insurance bill. So if someone making 36K gets a promotion and now makes 46K, I suppose that person will lose $3,300 in health subsidy, so really they are only getting a $6,700 raise. Will this have an effect on the work ethic of the American worker?

  3. jc says:
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    Gov Bob McDonnell of Virginia is being smart to carefully consider these state run “Health Exchanges” First of all, the states may be asked to run them but the decisions will be made by HHS.So if the costs of Obamacare exceed expectations and the health care service is below public expectations, governors, who have set up health care exchanges will be the first ones blamed. These exchanges are really technologically difficult to set up in that consumers have to be able to see the different plans on their computers and compare and click on the available plan and the health care subsidies are supposed to be available instantaneously. This in states that still run their Medicaid programs with paper forms and pneumatic tubes. If the states can’t run it, HHS has a history of doing things even worse (Remember the 100s of billions of Medicare waste thru the years, courtesy of HHS.) If I were Gov Bob McDonnell, I would let HHS run the health exchanges in Virginia.

  4. Kevin Duffan says:
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    jc- thanks for your comments. Healthcare reform (Obamacare, PPACA, whatever you want to call it) will definitely take some years to sort out. There are a lot of predictions about whether or not it will work, but those are just predictions. As you mentioned, the majority has spoken, the Supreme Court has spoken, and now we’ll have to let it play out. As a larger issue, I think it is really about a paradigm shift. Most people agree that our taxes should be spent on things like National Defense, roads, education… things for the common good. Healthcare is tough because it is expensive, and we haven’t previously been funding it properly. And some people are having trouble with the idea that it is for the common good.

  5. jc says:
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    Ofcourse initially, Obamacare will try to decrease costs on the backs of providers. In fact the Independant Payment Advisory Pannel has frozen specialist fees until 2020. So the gastroenterologist getting $60 for an office visit pays his nurse $20/hr and his receptionist $10/hr today. In 2020, he will still get $60 for an office visit and his nurse will demand $40/hr and his receptionist will demand $20/hr. I do not see how this is going to work. It is an economic fact that if the cost of providing a service exceeds the fee paid for the service, the service will not be provided.

  6. Kevin Duffan says:
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    JC- I would agree that no specialist will continue practicing if all (or even the vast majority) of the fees he collects needs to be paid out to his staff and overhead. I disagree with your prior comment that the only people that benefit from Obamacare are the trial attorneys though. In fact, I’m not sure how trial attorneys benefit from this at all. Are you claiming that Obamacare will lead to subpar medical care because all the good doctors will leave the practice of medicine because it will no longer be economically feasible to keep their doors open? I am not sure I buy into that argument. I know that trial lawyers get blamed for all the problems with the current healthcare system, but there is simply no evidence to support that and there never has been. That is an entirely different tangent we could discuss.

  7. jc says:
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    Kevin – -Obamacare is a trial lawyers dream! They are the only ones who have not had any restrictions placed on them by Obamacare. The current malpractice system is built on fraudulent plaintiff attorneys. There is fraud when the plaintiff attorneys advertise on T.V. and promise big recoveries. There is fraud when the plaintiff attorneys take the cases and promise big rewards. Most of the plaintiff expert testimony is fraudulent. Finally, after years of litigation, the poor patient, usually gets nothing as only 1 in 10 plaintiffs that go to jury trial win! As a result of all this, I practice defensive medicine and order more tests. Hey, you go out drinking at night and get a bad headache and come into the ER, you are probably hung over. But guaranteed, you will get a head CT scan to rule out tumor.

  8. Kevin Duffan says:
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    Well JC, it’s too bad that we’ve taken what was a good discussion and turned it into a rant against trial lawyers. I’m not heading down that path with you. I disagree with your last post entirely, but it would not be productive to try and deconstruct your argument that “fraudulent trial lawyers” have built the current malpractice system. The ironic thing is that I’ve had clients that I suspect are like you… they hate trial lawyers and everything we stand for, but then they get injured or wronged and feel as if only their claim is legitimate, but everyone else’s claim is bogus. That’s too bad. People do get hurt believe it or not, and sometimes it really is due to someone else’s negligence.

  9. jc says:
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    Kevin, in my state, plaintiff attorneys lose 85% of the cases they bring to trial. That 85% failure rate is unmatched in American Industry. Would you fly on an airline whose planes crashed and burned 85% of the time? Medical malpractice litigation is the most difficult litigation there is. Yet any lawyer who passes the state bar can sue a doctor the next day. This is the medical equivilent of allowing a recently graduated intern do neurosurgery. No hospital would allow that, yet newly minted lawyers are not barred by the State Bar associations or the court system from filing frivolous malpractice suits. The 85% failure rate at trial is the end result. Tort reform needs to happen with Obamacare now in place.

  10. Kevin Duffan says:
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    JC- some of the conclusions you are making are skewed by an incorrect reading of the data. It is true that roughly 85% of the medical malpractice cases that are tried end up resulting in a defense verdict. But that doesn’t mean that 85% of the cases are bogus or fraudulent. Every trial lawyer knows that the best cases tend to settle and never see a trial. If a defendant and insurance company know that they’ve got a bad set of facts for their side, the last thing they want to do put that in the hands of a jury to potentially get a huge verdict against them. You can’t look at the 85% statistic in a vacuum, and then draw a conclusion that 85% of cases are bogus, or are brought by a brand new attorney who has no idea what he or she is doing, when a majority of ALL malpractice case settle before they ever see a trial.

    Finally, jurors typically don’t want to believe a doctor has done something wrong. It is just human nature for most people to give a doctor the benefit of the doubt, even if his mistake is pretty clear.