The ACA and where we are today

Recent years have seen unprecedented rate increases for nearly all Affordable Health Care Act (ACA) policies. The losses have been piling up in recent years and currently there is no way to stop the bleeding. However, this is the first year that something really changes in the healthcare market. The good news is that viable options exist and most people are unaware that they are encouraged to look outside the box. Adaptation is key in our country’s evolving healthcare system.

In 2010, the federal government approved our first mandatory health insurance plan for most citizens under the age of 65. These changes came from both unregulated health care practices and a promise to help those who couldn’t afford insurance or didn’t qualify for a plan because of health problems. Funding for this venture was diverted from the Social Security Administration and other facets of government with restrictions on how health care providers (insurance companies) could divert profits. The purpose of this plan was to eradicate bad practices and corruption to help the greater good. The mandate also eliminated the practice of underwriting (verifying the health of prospects to grant approval), as it was considered discriminatory. The belief was that if enough people signed up for the new mandatory insurance, it would offset the risk of no insurance. Those in power were wrong.

Many healthy citizens were not happy with the higher premiums for a number of reasons. Some saw this mandate as a forced insurance against their constitutional rights. Others saw their premiums go up because of the mandate and were unwilling to pay the extra cost for the greater good. Because most of these Americans decided to “insure themselves” instead, or go without insurance, the system was financially doomed.

To cope with the losses, the participating insurers (virtually every health insurer in the US) began to limit networks to the point of creating nationwide HMOs that offer little or no coverage outside of small networks. They’ve also dramatically increased the deductible in an effort to control costs. When both strategies failed, as a last resort they began raising annual premiums to unfathomable levels, with some individuals seeing rate hikes of more than 60%. Today, many ACA insurers are expected to increase their premiums by more than 25% on average for 2018, with no end in sight. In Texas, on the stock exchange (Healthcare.gov), Blue Cross Blue Shield is the only original health insurer still standing. Everyone else (Humana, Scott and White, Aetna and United) have all left the state, as in many other states, to protect themselves from continued losses.

Changes have already been made that will permanently change the healthcare platform. In January 2017, the newly elected president issued an executive order to all facets of the federal government not to enforce ACA mandates on any individual, company or entity. With a Republican House and Senate, President Trump knew it was only a matter of time before the mandate was eliminated and he wanted to give Americans unlimited options without the threat of a fine. Whether the ACA will continue remains to be seen. In my opinion, it is highly unlikely that Obama concern will be the front runner.

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Until January of this year, secondary (term issued by the government for those health insurers that would not comply with the mandate) health insurance options that refused to offer the mandatory insurance had to tiptoe around the country’s new law. The federal government did not welcome competition and limited certain coverages these companies offered. In order to move forward, many of these companies had to offer hybrid packages that were unlike the mandated norm. Only a few of these companies stood on the sidelines at the start of the ACA and watched as the majority of their existing bookstores left the company and crossed the street. In fact, many of these secondary solutions have failed. The few who persevered did not meet the losses the ACA giants saw firsthand. They believed that it was not possible to eliminate underwriting and auditing costs at the same time, and they were right. Today, these secondary health insurers are welcomed with open arms by many who do not receive a subsidy (federal government premium credit for the lower income earners) and have absorbed the huge rate hikes of recent years. Outside of the ACA, these are the only plans with both affordable premiums and unlimited networks. In addition, unlike ACA plans, they are not exposed to non-traditional annual interest rate increases.

There is no way to say what the future holds with healthcare, only a promise of change. Our current healthcare arena has fueled perhaps the most controversial topic in American history. The country is divided over the different philosophies of compassion for the poor and sick or the need to stop the multibillion-dollar losses that continue to mount. Regardless of the outcome, it is clear that every citizen has a duty to freely explore options for their individual or family needs. Thanks to the implementing decree, options are now available without the threat of a financial penalty.