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Pre-ACA Health Insurance Market Isn’t Worth Returning To

March 24, 2017 at 1:45 PM

I’ve already explained that if the pending House bill to repeal the Affordable Care Act (ACA) becomes law, plans that people buy on their own will be far skimpier — as bad as, or worse than, before the ACA.  That’s because the bill would eliminate the ACA’s essential health benefits requirement, meaning insurers would no longer have to cover the full set of benefits they do now — including maternity services, prescription drugs, mental health and substance abuse treatment, and hospital care.  Now, let’s recall just what plans in the individual insurance market looked like before the ACA’s market reforms took effect in 2014.

Here are a few examples, drawn from plan documents and news reports:

  • In Arizona, a 2009 Aetna plan provided no coverage for pregnancy other than for complications and no coverage of substance abuse disorder treatment, mental health care, or the many prescription drugs that lack a generic version. The deductible was $7,500 for an individual and $15,000 for a family. A person with expensive health care needs could be charged up to $10,000 per year out of pocket to receive covered benefits. Under a family plan, that would rise to $20,000.
  • In Ohio, a 2013 UnitedHealth plan imposed a $10,000 annual deductible on individuals who needed any care other than periodic preventive visits and child immunizations. The plan covered no other doctor visits and no prescription drugs, maternity services, or mental health care. The out-of-pocket cap for covered services was $13,000 per year. Another Ohio plan available at the time had a $25,000 deductible.
  • In California, a 2010 Health Net plan had a $4,000 deductible and a $6 million lifetime limit on benefits. It included no maternity coverage and limited treatment of “non-severe mental disorders” to no more than 20 outpatient visits and 30 inpatient days per year.
  • In Colorado, a 2012 Cigna plan had a $7,500 deductible for individuals and $22,500 for a family. Out-of-pocket costs were capped at $5,000 a year for an individual and $10,000 for a family, but the cap didn’t apply to everything. Hospital stays (including to have a baby) had a $500 additional deductible that didn’t count toward the out-of-pocket cap, and a similar $200 “access fee” applied to emergency care. Physical, speech, and occupational therapy were technically covered, but for only 12 visits per year across all three services, and substance abuse treatment was excluded. To get prescription drugs other than those designated “preventive,” enrollees owed a $3,500 deductible that was separate from the main plan deductible and didn’t count toward the out-of-pocket cap.

Before the ACA, large gaps in benefits were common, cost-sharing charges were sky-high, and people who thought they had meaningful health insurance were surprised to find their plans didn’t cover the very services they needed when they were sick.

The ACA has made tremendous progress in addressing those problems.  The House Republican bill would bring them right back.

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