All the major medical carriers (Blue Cross, Aetna, Humana, United Healthcare, and Assurant) have come out with very similar customer retention plans for their current customer base for the state of Texas. They have done so to give their existing customers options with the implementation of the Affordable Care Act (commonly known as Obamacare).
In essence each company will be giving their customers the option of converting to a new “metallic” plan that will be available under the ACA or keeping their existing plans until Dec of 2014, at that point they will have to convert or buy a new metallic plan.
The advantage for many existing customers that chose to keep their current coverage is that their price rate will be fairly stable in comparison to their current rates. There will be a modest rate adjustment for age rating and some new taxes that will be implemented. The estimates that we have seen are that about 75% to 80% of the current customer bases current plans will be more affordable for this year by doing so. They will be able to maintain their exact same coverage for this one additional year.
The other option of either converting to a metallic plan or to buy a new metallic plan will be more affordable for the other 20% to 25% of the customer base. In most cases the way it will become more affordable is due to the advance tax credit subsidy that the government will be providing to those people making between 100% to 400% of the Federal Poverty Level (FPL). Keep in mind that a family of 4 making less than $94,200 is under 400% of FPL and thus will be eligible for a subsidy.
For the older consumer they should evaluate these options due to the 3:1 rule in place for pricing. They may get more affordable pricing due to this rule. Another reason, besides cost, that may drive a consumer to the new metallic plans is that by converting or buying new coverage they will be able to get rid of any exclusionary riders where the insurance company is not covering a particular condition or they may want some of the new essential health benefits, such as maternity.
Your agent should have access to all the information to help you compare and contrast your options beginning in the first or second week of September. As always, if you would like some assistance with your options please contact us at any time. You can reach me directly at [email protected]