Sunday, October 19, 2014

The ACA marketplace and the toilet paper aisle

My last post was in protest to a New York Times front-page article that highlighted the very real plight of ACA private plan buyers who were forgoing needed medical care because they'd bought high-deductible, mostly bronze-level plans. My beef was that the article omitted important context, e.g., that only 20% of ACA shoppers selected bronze and that the vast majority of low-income buyers who were eligible for Cost Sharing Reduction (CSR) bought silver plans that allowed them to access those important secondary subsidies.

I also suggested that the four individual narratives in the piece should not be taken at face value -- in particular, the plight of one woman who had selected a bronze plan with a $6,000 deductible but was plainly eligible for CSR that would have brought the deductible down to $500 at worst and as low as $25, depending on what plan she chose. This woman plainly made the wrong plan choice -- in itself a significant problem, but not one that the Times article addressed.

I want to focus here on a second brief narrative in the Times story, in which the woman in question was somewhat higher-income and so faced a tougher choice, with less obviously attractive options. Here's the tale:
But insurance plans with lower premiums generally have higher deductibles. Gina Brown, 37, of Nashville, was paying about $155 a month for a Blue Cross Blue Shield of Tennessee plan, after taking account of her subsidy. But her deductible was $4,000, she said, and so she avoided going to the doctor even when she got an ear infection over the summer.

“I attempted to treat it with over-the-counter and homeopathic meds,” she said. “Eventually it went away.”
Something does not quite compute here. The base price of  a solo  BCBS plan in Nashville for a 37 year-old starts at $135; there are six bronze BCBS plans ranging from $135--159 per month. (The multitude of one-brand options in itself seems kind of ridiculous; they are all quite stingy, providing no benefits, except the free screenings and checkups mandated by the ACA, before the deductible is reached.)

Leaving the subsidy question aside (was Ms. Brown buying for two or more household members?), most of these bronze do have $4,000 deductibles.  For another $20-odd dollars a month (premium of $176), however, Ms. Brown could get a silver BCBS plan with a $2,000 deductible. Even after the deductible is reached, the plan offers a crummy 50% coinsurance for doctor visits, generic prescriptions, and ER visits. For $183 per month, another silver BCBS plan is available, with a $2,500 deductible and only 20% co-pays. (All the BCBS plans here are Preferred Provider Organizations (PPOs), which suggests relatively good provider choices -- but how narrow is the network?)

These are tough choices, and there's more complexity if you delve into plan details. Blue Cross is far too dominant in this market; it's the only choice at low price points. The twenty cheapest plans are all BCBS; the cheapest non-Blue Cross option for our 37 year-old  is a Human bronze plan costing $212 per month.

The variants within the Blue Cross near-monopoly  remind me of the bewildering array of toilet paper options at the supermarket:  12 rolls of 350 two-ply sheets or 16 of 500 single-ply? Does the square footage include the, um, plies? You need a math degree. Or, in the case of health plan selection (in many cases)...a navigator.

P.S. This post is a footnote. Please read the prior.

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