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And before people get too comfortable -- Every single "Obamacare replacement" plan does away with the ban on lifetime caps either directly or indirectly. These

And before people get too comfortable -- Every single "Obamacare replacement" plan does away with the ban on lifetime caps either directly or indirectly. These are enormously beneficial to insurance companies (they essentially have unlimited liability without them) and there is a ton of money to have the caps reinstated.

dragonwriter 8y ago
> Every single "Obamacare replacement" plan does away with lifetime caps either directly or indirectly. You mean, does away with the ban on such caps, right?
- mikeyouse 8y ago
  I did indeed, thanks for the proofread.
deleted 8y ago
[deleted]
rayiner 8y ago
> These are enormously beneficial to insurance companies (they essentially have unlimited liability without them) and there is a ton of money to have the caps reinstated. I don't understand why you'd phrase it this way. Under the ACA, 80% of premiums have to go to medical care. A dollar saved providing care disproportionately benefits the premium payers, not the company. People act like all this money comes out of insurance companies' profits. Cigna's (to pick a random example), operating profit margin is 6.5%. There isn't this fat margin that insurance companies can use to offer additional benefits without raising rates. That's just the math. Saying that this is about what "benefits the insurance companies" is gas lighting the public. Lifetime caps insure that you, the ratepayer, aren't on the hook for unlimited liability. Now, I personally am willing to pay higher rates so people don't die when they hit their lifetime limit. But don't piss on my leg and tell me its raining, acting like the money isn't coming out of my pocket.
- zrail 8y ago
  The scenario the parent poster is describing is where ACA is repealed and replaced, and presumably that replacement would also do away with the 80% medical loss ratio. In that scenario the insurance companies will likely just not reduce premiums from what they are today, netting them a huge windfall. This is also why states like Alaska have seen ACA premiums fall over the past year or two. They instituted a state-wide reinsurance program, which means insurance companies' losses are capped at a reasonable amount per claim, then the state comes in and pays for the rest. This reinsurance program is funded in sort of a complicated manner, but basically it funnels the ACA tax credits that would have been paid to taxpayers, absent the reinsurance program, into the reinsurance program. Rates go down when insurance company losses are capped, either by a lifetime or annual benefit limit or by legislation that says they'll be made whole, because losses are predictable.
  - rayiner 8y ago
    Even before the ACA, most money from premiums was paid out in benefits: https://www.healthaffairs.org/do/10.1377/hpb20101124.949788/full/ https://www.healthaffairs.org/do/10.1377/hpb20101124.949788/... > According to an April 2010 report prepared by the Democratic staff of the Senate Committee on Commerce, Science, and Transportation, the nation’s largest health insurers in 2009 had medical loss ratios ranging from 68 percent to 88 percent in the individual market; 78 percent to 84 percent in the small-group market; and 83 percent to 88 percent in the large-group market.
    - zrail 8y ago
      For major medical plans, sure. Short term plans (which are still unregulated and should not be allowed to use the term "health insurance") generally have MLRs in the neighborhood of 50%. Also keep in mind, prior to ACA buying a major medical plan without through a large group required one to have no preexisting conditions. If you had one you were either denied or got an exception written into your policy that said they didn't have to cover anything related to that thing. That's one of the other major things that ACA did away with, and another reason premiums are higher.
    - 8y ago

dragonwriter 8y ago

> Every single "Obamacare replacement" plan does away with lifetime caps either directly or indirectly. You mean, does away with the ban on such caps, right?

mikeyouse 8y ago
I did indeed, thanks for the proofread.

deleted 8y ago

[deleted]

rayiner 8y ago

> These are enormously beneficial to insurance companies (they essentially have unlimited liability without them) and there is a ton of money to have the caps reinstated. I don't understand why you'd phrase it this way. Under the ACA, 80% of premiums have to go to medical care. A dollar saved providing care disproportionately benefits the premium payers, not the company. People act like all this money comes out of insurance companies' profits. Cigna's (to pick a random example), operating profit margin is 6.5%. There isn't this fat margin that insurance companies can use to offer additional benefits without raising rates. That's just the math. Saying that this is about what "benefits the insurance companies" is gas lighting the public. Lifetime caps insure that you, the ratepayer, aren't on the hook for unlimited liability. Now, I personally am willing to pay higher rates so people don't die when they hit their lifetime limit. But don't piss on my leg and tell me its raining, acting like the money isn't coming out of my pocket.

zrail 8y ago
The scenario the parent poster is describing is where ACA is repealed and replaced, and presumably that replacement would also do away with the 80% medical loss ratio. In that scenario the insurance companies will likely just not reduce premiums from what they are today, netting them a huge windfall. This is also why states like Alaska have seen ACA premiums fall over the past year or two. They instituted a state-wide reinsurance program, which means insurance companies' losses are capped at a reasonable amount per claim, then the state comes in and pays for the rest. This reinsurance program is funded in sort of a complicated manner, but basically it funnels the ACA tax credits that would have been paid to taxpayers, absent the reinsurance program, into the reinsurance program. Rates go down when insurance company losses are capped, either by a lifetime or annual benefit limit or by legislation that says they'll be made whole, because losses are predictable.
- rayiner 8y ago
  Even before the ACA, most money from premiums was paid out in benefits: https://www.healthaffairs.org/do/10.1377/hpb20101124.949788/full/ https://www.healthaffairs.org/do/10.1377/hpb20101124.949788/... > According to an April 2010 report prepared by the Democratic staff of the Senate Committee on Commerce, Science, and Transportation, the nation’s largest health insurers in 2009 had medical loss ratios ranging from 68 percent to 88 percent in the individual market; 78 percent to 84 percent in the small-group market; and 83 percent to 88 percent in the large-group market.
  - zrail 8y ago
    For major medical plans, sure. Short term plans (which are still unregulated and should not be allowed to use the term "health insurance") generally have MLRs in the neighborhood of 50%. Also keep in mind, prior to ACA buying a major medical plan without through a large group required one to have no preexisting conditions. If you had one you were either denied or got an exception written into your policy that said they didn't have to cover anything related to that thing. That's one of the other major things that ACA did away with, and another reason premiums are higher.
  - 8y ago