[quote=bearishgurl]
If you’ve read and studied the entire bill, SK, then perhaps you can explain to us here how these carriers are going to recoup the $$ when they can’t charge “Susie the recent cancer survivor” (age 59) or “Joe 6P the walking heart attack” (age 57) $1100 to $1600 a month for a premium anymore and may not deny either of them coverage.
The money to take care of these folks has to come from somewhere.[/quote]
I haven’t studied the bill, but I have read it. There is nothing that will keep them from charging $1100 to $1600 a month. (Depending on Susie and Joe’s age, they may already be charging those premiums.) There will still be risk-based pricing. Pricing will be significantly more complicated post-2013, in part depending on whether policies are inside or outside of the exchanges. And that complexity will vary from state to state, as some states already have guarantee issue and community rating in place, and high risk Susie and Joe may already be covered. In the majority of states, where those plans are not yet in place, that risk premium is expected to be transitional in nature and will in part be covered by reinsurance which will mitigate, in part, that risk premium.
Peripherally related, I recently sat in on a round table discussion (meaning me, and 4 guys sitting at a round table at a bar.) with 3 (of the 5) major carrier sales executives in my current state, along with a big group agent. They all expect 2012 to be the most competitive year in the last 10 with regards to pricing. Primarily as a result of 85% MLR floor (for group policies) set in place by the ACA, effective the first of this year. One way the insurance companies are attempting to circumvent the floor (or at least shift costs, effectivly circumventing it) is to include broker commissions as part of medical costs. They don’t expect that will happen, and as a result, fully expect commissions to be cut, maybe dramatically from the current standard of 5% for group policies.
