Meet Pete, A Pissed Off Young Invincible [BUMPED]

WARNING: YOU WILL NOT SEE THIS ON HEALTHCARE.GOV!

Over the last few weeks I've been introducing IB readers to several people through HHS's stories. These are the folks we hear about in the main stream media that believe they will benefit under the Patient Protection and Affordable Care Act.

I would like to introduce you to Pete. Pete is a 36 year old single guy living in North Carolina enjoying a professional career and engaging in the purchase of his own health insurance. Pete also just bought a house, is trying to grow his business, and paying for his car. Last year Pete paid $204 per month for a plan from BCBS of North Carolina. This year he is paying $248. His plan is a PPO with a $2500 deductible and an out of pocket maximum of $3000. He has copays for office visits, and a prescription card too. Pete feels it is important to purchase insurance for the protection and peace of mind.

This. Will. Change.

Under Obamacare he will lose his current plan which will be replaced by something that includes all essential benefits including maternity. (Yes, he must now have coverage for a benefit that he personally will never use) On top of not being able to keep his current plan, Pete is concerned about what it is going to cost him. Because he makes what Obamacare considers too much money he won't qualify for any subsidy. 

So what exactly is it going to cost him?

In rates released by BCBS, a comparable plan (the one with closest benefit match) will be a Gold level plan with a monthly premium of $416.40. Of course he could opt for the lowest premium option available for only $271.45 per month. But doing that would increase his deductible to $5500 and eliminate his copayments for office visits and prescriptions.

So what is Pete going to do? His response: "I don't know - I'm having difficulty logging into the system."

ObamaTax Lawsuit

A Florida orthodontist has filed suit against the administration in an effort to compel Ms Shecantbeserious and her minions to actually, you know, follow the law:

"The lawsuit, filed by Dr. Larry Kawa, claims that the regulatory changes violate the Administrative Procedure Act and go beyond President Obama’s constitutional powers."

[ed: The Daily Mail link seems to be sputtering right now]

Whether or not he'll be deemed to have "standing" remains to be seen (although it wouldn't hurt if some of our CongressCritters grew a spine and joined him).

[Hat Tip: Ace of Spades]

Cavalcade of Risk #193: Rich Get Richer edition

Dennis Wall presents a unique take on the Cav, highlighting posts about economic risks in a sluggish economy.

404Care

Heh:

We get mail (and phone calls)

As one might imagine, there've been lots of notes and calls today asking for info on the Exchanges. We'll have updates on the roll-out as the days (and weeks) go by, but here's what I've been sending my clients and prospects for the basics:

ACA Marketplace (Exchange) Basics - Part 1 of 2

ACA Marketplace (Exchange) Basics - Part 2 of 2

ACA Basics: Private Exchanges

ObamaTax Jitters - Part 2

Yesterday, we learned about some of what we can expect policy-wise as the Exchanges open up today. But it's not all fun and games; here's more from our Maryland friend:

I've been thinking about that 100% coverage plan I mentioned before ("BCBS has one plan where you pay nothing for health care, no deductible, no copay, no coinsurance, nada"). It's actually kind of tricky: the plans as designed probably can't fulfill the promise if they're priced anywhere close to what they'll need to be. It's essentially a blow-off to the middle-class; to understand why, you have to understand how the subsidies are supposed to work:

Every person or household will have a new calculation on their 1040: MAGI (modified adjusted gross income). If that number puts you at 400% of the poverty level (PL) or less, you are entitled to a subsidy, limiting your premium payment for the second cheapest silver plan to a percentage of your MAGI (it's a sliding scale, your results may differ). So if you have a MAGI of, say, 10,000, this puts you at PL and your silver insurance plan will cost you $200/year. The difference between that and what it actually costs is paid directly to the insurance company by the federal government. The thing is, you can take that subsidy dollar amount and apply it to any plan.

What that means is this: many middle class people are going to have a MAGI that precludes them from subsidies. I was thinking along traditional lines: "Wow, a 100% plan is going to be hideously expensive" and it probably will be, but because the subsidy dollar amount is portable to any plan, lots of people may be able to get a plan that pays 100% of their medical costs for less than they are paying for insurance now. They may not, it depends on the total premium cost, but middle class folks without subsidies almost surely will find that plan unaffordable, and if a significant number of people are able to get on a 100% plan that is subsidized to the point where they can afford it, the demand side of the supply and demand equation is going to go through the roof. This will collapse the availability of medical treatment rather quickly as demand spirals far beyond the ability of what docs and hospitals can provide.

Thanks for the update, WD!!

Our friend echoes a point that Bob's made about price elasticity:

"Sugar has price elasticity. As the price of sugar rises, demand decreases since there are substitutes for sugar ... Gasoline is inelastic ... At this time, there really is no substitute for gasoline."

And of course, there's really only one substitute for health care.

[Hat Tip: Ace of Spades]

Welcome to ObamaCare Ohio [UPDATED]

UPDATE (From HGS): A reader sent us a pdf of his Exchange experience this morning.

Here's a sample:

"Got to security questions, and the site wouldn’t let me select a security question from what was presumably a drop down list of questions. At that point, thought I’d try the ‘live chat’ to find out if maybe the site didn’t work with my Google Chrome browser…unfortunately, after about 5 minutes wait, I still wasn’t able to send my question via Chat."

UPDATE 2: More from our intrepid reader - Transcript of his online help Chat Session:

[07:59:14 am]: Thanks for contacting Health Insurance Marketplace Live Chat. Please wait while we connect you to someone who can help.
[08:29:12 am]:  Please be patient while we're helping other people.
[08:29:41 am]:  Please be patient while we're helping other people.
{Snip}
[08:48:16 am]:  Please be patient while we're helping other people.
[08:49:10 am]:  Please be patient while we're helping other people.
[08:50:14 am]:  Please be patient while we're helping other people.