98 percent of individual health plans flunk Obamacare standards

Do you remember when President Obama promised: "if you've got health insurance, you like your doctors, you like your plan, you can keep your doctor, you can keep your plan.  Nobody is talking about taking that away from you"? It turns out that the Affordable Care Act's experts didn't get the message. According to a new study at HealthPocket.com, "less than 2% of the existing health plans in the individual market today provide all the Essential Health Benefits required under the Affordable Care Act (ACA)."

% of Essential Health Benefits Covered in Existing Health Plans [by Kev Coleman at HealthPocket.com

Who knew that Americans had such pathetic insurance coverage? The average plan currently meets only 76% of the mandatory essential benefits that will be forced down every American's throat starting next January 1. This epitomizes the Washington-knows-best mentality that permeates this deeply flawed law. Americans can't be trusted to figure out what health insurance coverage they need: not only do federally-appointed experts have to point out all the gaps in their plans. Americans need to be forced to fill all the identified gaps in coverage.

Anyway who's taken Econ 101 should realize this portends the breaking of another one of President Obama's oft-repeated campaign promises: "The Obama plan will save a typical American family up to $2,500 every year on medical expenditures." It should be obvious this cannot possibly be true for Americans unlucky enough to be stuck in one of the 98% of plans found by the Obamacare experts to be defective.[1]  

What's especially ironic about all of this is how ineptly the government has managed the two large public insurance programs for which it has been responsible for nearly half a century. That is, they've had ample time and opportunity to tweak and perfect these programs, yet:

  • "Medicaid is America's worst health-care program"
  • Medicare beneficiaries have no coverage for dental and vision care, nor is there any catastrophic limit on financial risk for those with the highest medical bills.
  • Medicare pays 74 percent of costs associated with covered benefits for an individual with average health care costs, whereas the typical large employer PPO pays 85 percent of such costs.
  • Indeed, the expert-designed coverage prescribed under Medicare is so lousy-that is, so far removed from what the average senior would select if given the freedom to do so-that 90% of Medicare beneficiaries secure some sort of supplemental private insurance.

But rather than fix these clearly flawed government programs, Obamacare instead will attempt to shovel 50 percent more Medicaid beneficiaries into a program that already badly serves its existing recipients. And instead of filling in the gaps in coverage for seniors, Obamacare transfers hundreds of billions of dollars out of Medicare to help bankroll dental and vision benefits for children and back-end catastrophic protection for everyone else. Or as one experienced analyst put it "seniors have been singled out and forced to bear a disproportionate share of the cost of a new entitlement for young people."

Some may read the foregoing and conclude "not bad for government work." Others may wonder how in the world we ended up with a health law that deviates so radically from what was promised for it. Is this really the best we can do?


[1] The study examined nearly 11,000 health plans offered in the individual market, but it did not assess what percentage of Americans are enrolled in purportedly defective plans. It did not include employer-based plans. However, a previous government study had assessed that for some essential health benefits, such as preventive dental services for children, only 5% of small group plans met the essential health benefits standards.  Even federal and state employee health benefits came up short of meeting all the new Obamacare requirements, which is almost certainly indicative of the general state of coverage among large employers. In light of all these limitations on the available evidence, it would be inaccurate to say that 98% of Americans face higher premiums as these coverage "gaps" are rectified. But it also should be obvious that this fraction well exceeds 50%. The "average" American surely will face premium hikes. This latest study was completed by Kev Coleman, Head of Research & Data at HealthPocket.com. Correspondence regarding this study can be directed to Mr. Coleman at kevin.coleman@healthpocket.com.


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About the Author


Christopher J.

  • Christopher J. Conover is a Research Scholar in the Center for Health Policy & Inequalities Research at Duke University, an adjunct scholar at AEI, and a Mercatus-affiliated senior scholar. He has taught in the Terry Sanford Institute of Public Policy, the Duke School of Medicine and the Fuqua School of Business at Duke. His research interests are in the area of health regulation and state health policy, with a focus on issues related to health care for the medically indigent (including the uninsured), and estimating the magnitude of the social burden of illness. He is the recent author of The American Health Economy Illustrated and is a Forbes contributor at The Health Policy Skeptic.

    Follow Chris Conover on Twitter.

  • Phone: (919)428.4676
    Email: chris.conover@duke.edu

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