Why doesn't Affordable = affordable?

I thought I'd give the facts that no one wants to hear. Why did the "Affordable" Care Act cause all the insurance premiums to jump so much? This information is factual but my opinions sneak in from time to time.

One of the primary reasons that premiums have increased is that ACA qualified plans now cover pre-existing conditions without restrictions or upcharges. This means that you can have cancer or be pregnant when your plan starts and they will still cover you. (this is also the reason for the limited enrollment period - so you don't wait until you are needy to sign up). Imagine if you could buy auto insurance that would cover your accident AFTER it happened! Before the ACA people with issues had to pay high fees for state risk pool coverage or go without insurance. All these people suddenly having coverage caused a huge jump in claims.

The next big category that caused the premium increases are the caps on deductibles, max out of pockets and annual/lifetime limits. I know many people are upset about the $5000 or higher deductibles we are now seeing but it was worse. People could have $10,000 even $20,000 deductibles and coinsurance after that! The ACA put a cap on the deductibles. For 2019 those caps are $7900 per person or $15,800 for a family (no matter how big the family). These caps are ALSO your max out of pocket caps - once you've paid that much (in network) you are done. Pre-ACA plans may have had a much higher max or no max at all. The annual and lifetime limits - meaning how much the insurance will pay before they stop - those are gone! I know someone who recently had premie twins and their hospital bills totalled around $5 MILLION. Pre ACA the insurance company probably would have stopped paying after $1M or maybe $2M. All of this puts a lot more expense and risk on the insurance companies so they charge us more.

Those things are the bulk of it but some other price jumpers are the addition of mental health coverage, maternity care (rarely available for individuals before), full pharmacy coverage, free preventive exams, no riders and a 1:3 ratio between the youngest and oldest people in premiums.

"I'm healthy, I never spend that much, I don't need those other coverages" - these are all true for many people. For others, these changes are a godsend. I also don't believe that the creators of the ACA expected so many insurance companies to leave the system or cut their networks. Insurance companies are mostly for profit businesses and they weren't making the profits they wanted (most have fully recovered by now tho). The ACA was kind of like a parent protecting us "for our own good". Nice when a bad thing happens but really annoying otherwise. With the $0 penalty starting in 2019 more people - especially healthy ones- will take non ACA qualified plans that won't cover all those things. This may be just fine and save you some money - just be aware of what isn't covered. Take the time to read ALL the details and/or work with a reliable agent. Need help? Let's talk!