How The Baucus Bill Bilks People Over 50

[kpete]

How The Baucus Bill Bilks People Over 50
— By James Ridgeway | Fri September 18, 2009 9:11 AM PST

The people who stand to get screwed most by Max Baucus's health reform plan are those who aren’t old enough to qualify for Medicare, but are still old enough to be discriminated against by insurance companies.

For several months, the Columbia Journalism Review has been publishing analyses of the Massachusetts health care system, which in many ways serves as a model for the current national health care reform—a canary in the coal mine for the rest of us. The state mandates that all residents have health insurance or face a tax penalty. And while it does provide some regulation of private insurers, it doesn’t outlaw “age rating”—setting different premium rates based on age. This doesn’t apply to most working people who are covered by group plans through their employers, at group rates. But for the self-employed and early retirees—whose numbers are growing since the recession began—the costs can be devastating. CJR cites reporting by Kay Lazar in the Boston Globe, which found:

State law allows insurers to charge older people up to twice as much as younger people for the same coverage. In other states, the disparities can be even greater. One result is that more older people choose less comprehensive plans. Data from the Commonwealth Choice program, which offers state-approved private insurance, show that as enrollees grow older, more choose cheaper and less comprehensive coverage.

The main solution that’s been proposed for this problem is to make it “easier for self-employed people and retirees who are 50 to 64 to be exempted from a stiff tax penalty if they can’t afford insurance.” So rather than force insurance companies to stop discriminating on the basis of age, the state may begin “allowing” 60-year-olds to live without health insurance. So much for the great Massachusetts universal coverage model.

All of the major health reform plans that have been floated in Congress allow age-rating. And the Baucus plan endorses disparities even greater than those in Massachusetts. As the New York Times reports:

Under Senator Baucus’s plan, insurers would be permitted to charge older people five times more for their health insurance premiums than younger people. That proposal, first circulated in a Finance Committee policy options paper last spring, is a significant departure from the approaches put forth by three House committees and the Senate Health, Education, Labor and Pensions Committee. Those bills would only allow insurers to charge older people twice as much as younger ones….

According to AARP, the lobbying organization for older Americans, the number of uninsured adults between 50 and 64 grew to 7.1 million in 2007, an increase of 36 percent over 2000. Among the main reasons for the increase: higher premiums demanded of older, sicker people seeking coverage in the individual insurance market.

more:
http://www.motherjones.com/mojo/2009/09/how-baucus-plan-screws-over-50-crowd

[TxRider]

1. Of course, that age group has all the income.

[Vincardog]

5. I am in that age group. I am broke. Where is your link?

[OHdem10]

7. The Seniors have lost ground financially just as other groups.

It Seniors have all the Income, the country is in worse
problems than I could believe.

It is as if Baucus has paid no attention to conditions of
anyone in the country.

[marlakay]

16. I'm 53 and I don't have lots of money

if it wasn't for the union we retired from we would have no insurance. But as it is we skip a lot of tests because we have to pay high deductible and 20% of things.

I think our group needs more care not less. Most people my age could nip things in the bud if found fast.

[The_Casual_Observer]

2. Under the baucus "plan" you hope to god that you never have to rely

on the "plan".

[JimWis]

3. Yup. I believe most of the other plans out there are somewhere

around 2 to 1 based on age. But Baucus's has 5 to 1. No doubt his plan was written by insurance companies.

[subterranean]

9. The insurance companies specifically asked for a 5:1 ratio.

I forget where I read it, but they said they couldn't make a profit with a 2:1 ratio and that a 5:1 ratio would be more industry-friendly. "Ask and you shall receive," said Max Baucus.

[slipslidingaway]

14. Quoted in the Time article...

Links here...

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=6569425&mesg_id=6570796

But one variable that will persist is age, since older enrollees represent more health risks than younger enrollees, and insurers are doing their best to retain the most flexibility in that area. Current reform legislation in the House and the Senate Health, Education Labor and Pensions (HELP) Committee would allow insurers to vary premiums on the basis of age only by a factor of two, meaning insurers would be allowed to charge older enrollees premiums that are twice as high as those for younger ones. (In the health-policy world, this is known as a 2-to-1 age rating.) That may sound like a huge concession to private insurers, but they insist it would lead to only one of two scenarios: financial ruin for private insurers or exorbitantly high premiums rates for young Americans.

"You couldn't do business at 2 to 1. The younger people's premiums would just be too high," says Charles Kahn, president of the Federation of American Hospitals, a lobbying group for investor-owned hospitals, and a former lobbyist for the insurance industry during Bill Clinton's health-care reform battle in the 1990s. Essentially, a wider "age band," like the 5-to-1 ratio insurers favor, would allow them to charge higher amounts to middle-aged people not yet old enough to qualify for Medicare, while keeping younger people's premiums much lower. In a recent letter to Henry Waxman — chairman of the House Energy and Commerce Committee, one of five congressional committees with jurisdiction over health reform — the president and CEO of Blue Shield of California wrote, "Given the systematic consequences of imposing such a tight band, we strongly urge you to widen it."

Insurers are also keenly aware that they can afford to offer coverage to everyone who applies only if coverage is truly universal. "If there's a requirement that everyone will participate, it's possible to do these market reforms without cost skyrocketing," says Robert Zirkelbach, spokesman for Ignagni's group, America's Health Insurance Plans (AHIP)..."

What has happened in Massachusetts with a 2-to-1 age rating...

http://www.cjr.org/campaign_desk/health_reform_lessons_from_mas_5.php

"...After hearing from older readers who complained they were having a tough time with the mandate because they could not afford a policy, Lazar reported on the problems with age rating. Massachusetts may require insurers to cover the sick, but it doesn’t force them to sell affordable policies. Rates for an older person can be twice as much as that for a younger person, requiring them to pay several hundred dollars more.

To fit premiums into tight budgets, some residents have purchased policies with less coverage and more out-of-pocket costs. Some forty-two percent of people buying their policies through the Connector’s shopping service choose policies that generally require more cost sharing. Another irony: State data show that as residents get older they choose cheaper, less comprehensive plans just when they need medical care the most. The Senate Finance Committee draft would allow insurers to charge older people up to five times more than younger people, a provision that will likely mean older people in other states will face the same problems as those in Massachusetts. Will an insurance policy always give someone a chair in the doctor’s office?..."

[brightertomorrow]

18. Would your employer be willing to pay that much more

for your insurance for the over 50 group? Or would they have to drop you too like a hot potato because they could no longer afford your health insurance? No wonder they call the baby boomers the YOYO generation. More and more we do feel like the "you're on your own" group.
What was Baucus thinking with this plan!
So wishing someone would come to their senses and go for single payor.

[stray cat]

4. and its better now? some can't even get coverage presently

[TreasonousBastard]

6. Everybody complains, but nobody answers...

just who is going to pay for these "older and sicker" people?

Healthcare is presently presumed to cost about $7,500 per person in the US. This number is suspect for a number of reasons, but if it's close to true a family of four uses around $30,000 of healthcare a year.

THIRTY THOUSAND DOLLARS A YEAR? OK, not many families of four actually have that many medical bills, but that's the way the averages work out.

So, somehow we have to come up with 30 grand every year for this family of four. Another way of looking at it is that we have to come up with $525,000 (in current dollars) over the lifetime of every US resident to pay for medical care.

Where is this money coming from? And with the continuing aging of the popeulation and new life-extending technologies constantly being invented, how much money will we need in the future with 50 million or so of the population in nursing homes?

Cut out a third in waste, profit and overhead? OK, that sounds good, but then that family of four will still need to come up with 20 grand a year. And the that family income will still be around the median of 50 grand.

So, again, where is the money coming from?

The only answer is to aim at the structure of healthcare delivery, and stop whining about who pays and how. Bundled treatment payments, salaried doctors, subsidized local clinics, computerized records... All tweaks that help, and can change the system. It can't change overnight, but it can, and must, be changed.

[daa]

10. Who pays is the rest of the world

for half the cost?????????????

[slipslidingaway]

8. knr n/t

[daa]

11. This explains why older people are against the plan

and do not trust Obama.

[mmonk]

12. Yep.

This is one of many issues depending on the outcome which will determine if I will waste my time voting in 2010 or if I will be voting for something.

[brightertomorrow]

13. since no one seems to want to insure the over 50 group

they need to open medicare and allow everyone over 50 to be eligible instead of allowing insurance companies to discriminate against them for their age.
But I thought Obama's plan was supposed to limit premium discrimination based on age and gender. At least it Still says so in his health plan on whitehouse.gov. Everything is so confusing with so many plans around. Hope when they finally come up with the final plan that it actually has something in it to help the American people and make it more of a level playing field for us all.

[Phoebe Loosinhouse]

17. Bingo! 50 seems to be the magic age when we get put on the "Manager's Discount" table

we're still slightly within the expiration date if you hurry right home with us, but don't linger because we're all about to go bad at any moment!

[moondust]

15. Making a killing off the baby boomers.

Isn't that what Johnson & Johnson did back in the 50s and 60s? And Gerber?

I'd bet some profiteers have been licking their lips just waiting for the boomers to get old.