The Affordable Care Act, better known as ObamaCare, was passed in 2010. Thirteen years later we have a much better perspective to judge its effectiveness in achieving its goals. What is the ObamaCare reality in 2023?

John C. Goodman is a healthcare economist and public health policy consultant. Beverly Gossage is a Kansas state senator and insurance broker. Here’s what they write in his blog at independent.org, which was also published in The Wall Street Journal on September 12, 2023. “When Democrats passed the Affordable Care Act of 2010, President Obama and lawmakers made the same claim over and over: The act would make good, affordable health insurance available to people with pre-existing conditions. The actual result has been the opposite. ObamaCare makes health insurance as good as possible for the healthy and as bad as possible for the sick.”

The Progressive spin on ObamaCare has not let up under the Biden Administration. According to President Biden, health insurance in America is free or almost free (“as little as $10 a month or less” after subsidies) for about 80% of people who acquire it in an ObamaCare exchange. Most preventive care – the only kind of care healthy people require—is also free.

But this is much like the fact that banks are always eager to lend you money when you don’t need it – but very reluctant when you do! If you are sick, things are different. Consider a hypothetical middle-aged couple in Dallas earning $70,000 a year. Suppose they have two children, both of whom have serious birth defects. Although this family will pay no premium for a Blue Cross bronze plan in the ObamaCare exchange, they will face a $9,100 deductible for each child. Their total out-of-pocket exposure is $18,200 a year.

It gets worse. Patients with serious diseases often require the care of highly trained specialists who usually work at centers of excellence. But that family in Dallas will discover that their Blue Cross plan isn’t accepted at leading cancer providers nearby, including Baylor University Medical Center and the University of Texas Health Science Center, or MD Anderson Cancer Center in Houston.

Goodman describes the situation in Texas, because that’s where he lives. But the problem isn’t unique to Texas. ObamaCare plans have very skinny networks in every state. They tend to pay providers Medicaid rates or close to them. As a result, ObamaCare looks like Medicaid with a high deductible. A great many providers, including prestigious medical institutions, won’t accept Medicaid managed care—the version of Medicaid most recipients receive—or ObamaCare. When a patient with ObamaCare coverage goes out of network, the plan usually pays nothing and the patient’s payment doesn’t apply to his deductible or out-of-pocket maximum.

In addition to ObamaCare’s high medical expenses for the sick, there is an implicit tax on their earned income. Suppose our Dallas family earned only $60,000. According to Healthcare.gov, their children could qualify for CHIP, (the Children’s Health Insurance Program) or Medicaid, and they wouldn’t be allowed into a subsidized private exchange plan. Given their lower income, the best exchange plan the family would qualify for would now be the Blue Cross silver plan, which carries zero premium. This means that if the parents stay healthy, they would have no out-of-pocket medical expenses.

But things quickly change if they rose to $70,000 household income again. The penalty would be an $18,200 increase in maximum medical costs—a marginal tax rate of 182%. Even with the children on CHIP, the parents could have serious medical problems of their own and an accompanying implicit tax on income. At an income, say, of $30,000, the best option is a silver plan with a small premium combined with a small deductible. But if their income doubles to $60,000, the out-of-pocket exposure will increase by $14,200. That’s an implicit marginal tax increase of 47%.

The plain truth is that ObamaCare was designed to save the government money! It works great for the healthy, but not for the sick. But Goodman says this design wasn’t really done by Obama or even Democratic lawmakers. It was done by special interest groups – those that are profiting from the system. ObamaCare is pouring about $60 billion a year of new money into the healthcare system. The beneficiaries of this government largess are the hospitals, insurance companies, and some doctors – though there is no evidence of any overall increase in the amount of healthcare delivered.

The lesson learned from this real-life story is simple – stay healthy. The Affordable Care Act is only affordable for the healthy.

We’re discussing mistakes to avoid when signing up for Medicare. It’s open enrollment time and all seniors must decide whether to stay with their current healthcare plan or make a switch. If you want to switch, this is the time to do it. But beware of possible mistakes you can make.

In Part I of this series, we discussed the two pitfalls to avoid when signing up for your healthcare.  Anna Wilde Mathews, writing in The Wall Street Journal, warns us of five pitfalls. The first two pitfalls were avoiding the Medigap Trap and choosing the Wrong Doctors. Today, we will cover the other three pitfalls to avoid.

Paperwork Problems

Medicare Advantage plans can sometimes delay or block access to care. A recent government investigation found some beneficiaries were denied services that should have been covered. You might need to get approval from the insurer before you get a surgery, or a referral from your primary-care doctor to see a specialist. You may also find that those nifty extra benefits touted in ads are extremely limited.

Seniors often don’t focus on these issues, particularly when they are healthy, said Tatiana Fassieux, education and training specialist for the nonprofit California Health Advocates. “Tomorrow you may end up having a stroke,” she said. “Once you start using the more costly care, that’s when the brakes come in.”

To understand the hurdles, you should look at plans in the Medicare.gov tool. As you scroll down each table, you will see small “limits apply” notices next to specific types of care, such as inpatient hospital use or radiology scans. Click on them, and you will find more details about what requirements you might face to get that kind of service, such as prior approval from the insurer.

For a more in-depth explanation, you should go to the insurer’s website and look at key documents, such as the summary of benefits and the full “evidence of coverage.” They are difficult and complicated, but they include pretty much everything there is to know about the plan.

Drug Deficits

Your drug coverage can come through a stand-alone Part D plan—needed if you are in traditional Medicare—or wrapped into your Medicare Advantage. Either way, you can use Medicare.gov to see if your prescriptions are included. This is worth doing every year. You may also want to go to the insurer’s own website and look for restrictions on access as well as the “comprehensive formulary” document that lists all covered drugs.

Biased Advice

Be careful where you turn for advice. Ads peddling Medicare Advantage plans may flash pictures of government Medicare cards and include a toll-free hotline that looks official but isn’t the real federal number. Watch out for websites tied to particular insurers or online agencies that may have strong incentives to push certain plans. One tip is helpful; if the site ends in .gov or .org, it’s more likely to be unbiased.  To find real, impartial information, start with Medicare.gov and go from there. There are also counselors in every state under the State Health Insurance Assistance Program. There is also a national helpline maintained by The Medicare Rights Center.

As a senior, and a doctor, I recommend staying with Original Medicare if you can afford the costs, which are higher than Medicare Advantage plans. Original Medicare will give you the greatest freedom to choose your doctors and the least restrictions on the care you will receive. It’s time to choose, but choose wisely.

It’s that time of the year when seniors must choose a healthcare plan. It’s Medicare open-enrollment time, but beware of making Medicare mistakes.

Medicare Advantage plans will be filling the airwaves with their enticing advertisements to join their plans. Medicare Advantage plans are not the federal government; they are private insurance plans for seniors who are eligible for Medicare. Their advertising makes them appear to be government plans, but they are entirely managed by private companies. This may be a good thing, if they provide you with more coverage for less money, but beware of the limitations of these plans.

According to the Center for Medicare Advocacy, as of March 2023, 65,748,297 people were enrolled in Medicare, an increase of almost 100,000 since the last report of September, 2022. Of those, 33,948,778 were enrolled in Original Medicare and 31,799,519 were enrolled in Medicare Advantage or other health plans. That’s nearly half of all seniors enrolled in Medicare.

Why the popularity of Medicare Advantage plans? They generally give you more coverage for the money. They usually provide benefits greater than Original Medicare, such as dental, vision, and fitness coverage. They usually cost less, too. So why doesn’t every senior sign up for Medicare Advantage?

An article in The Wall Street Journal, by Anna Wilde Mathews tells us why. Lothaire Bluteau, 66 years old, an actor who lives in West Hollywood, Calif., last year enrolled in one of the private plans known as Medicare Advantage. After he was diagnosed with prostate cancer last May, he discovered the specialists he wanted to see weren’t in his UnitedHealthcare HMO’s limited network. He faced delays getting tests and treatment.

He got a bigger shock when he tried to get access to more doctors by switching to traditional Medicare, run by the federal government. Bluteau worried about the steep out-of-pocket costs, so he tried to get a fill-in policy known as a Medigap plan that would cover many of those expenses. Yet health insurers said no because of his cancer diagnosis. He didn’t realize he could be rejected. “I didn’t inform myself enough,” Bluteau said. “I was so stupid.”

Bluteau’s struggle to get a Medigap plan shows one of the risks seniors may miss when they are selecting coverage. Medicare beneficiaries generally don’t know that they have a right to get Medigap policies only at certain times, and if they don’t jump then, they might not be able to purchase them later. Medicare’s open-enrollment period kicked off Sunday and goes until Dec. 7. During that time, beneficiaries can pick new plans for next year. The options include traditional Medicare from the government, or the wide array of Medicare Advantage plans, which are private-insurance products that wrap in the same benefits.

Pitfalls to Avoid

If you are a senior going through open enrollment this fall, here are five pitfalls to avoid:

Medigap Trap

Patients with health issues may want to move to original Medicare, but they can’t buy Medigap or Medicare Supplement policies. Medigap, or Medicare supplement insurance, doesn’t have the same rules as most health insurance. For other types of coverage, insurers can’t reject you or charge you more based on your medical conditions. With Medigap, such guarantees are available only at certain times. Medigap is vital for many people who enroll in traditional Medicare. The original government program can leave beneficiaries with big out-of-pocket bills for their care, and there is no cap on how high that tab can go. Medigap policies help cover those costs.

The best time to get a Medigap plan is when you first join Medicare when you turn 65. Then you have a six-month window to buy your policy. After that you must find a protected window, such as if you opt out of Medicare Advantage during a limited initial “trial period.” State rules vary so check with your own state department of insurance.

Wrong Doctors

Another common trap that can ensnare people who sign up for Medicare Advantage plans: a lean menu of doctors and hospitals. The plans—particularly health maintenance organizations, or HMOs—can have limited networks that sometimes mean beneficiaries can’t go to the doctors or hospitals they want. When Bluteau chose his HMO plan on the advice of an insurance agent, he said, he didn’t realize it lacked doctors he would want to see. He was ultimately able to switch to a different UnitedHealthcare Medicare Advantage plan, a preferred provider organization or PPO, that included them.

You can find directories of in-network doctors on the insurers’ websites, but be careful. “They can be wildly inaccurate,” said Julie Carter, senior federal policy associate at the Medicare Rights Center, a nonprofit. “It’s a mess, and we don’t really have a great solution other than doing a lot of legwork.” Don’t just trust—be sure to verify. You should call the doctor offices and hospitals that matter to you, and consider looking up other providers you might need unexpectedly, such as nursing homes. You should call the insurer, and be specific about what plan you are researching and which doctors and hospitals you want.

(Author’s Note: There are three more pitfalls to avoid. We’ll cover those in my next blog.)