Health plans in the new healthcare exchanges
By Dr. Jonathan Kaplan

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If you've been keeping up with the healthcare debate, you'll notice Republicans are predicting the demise of "Obamacare" and Democrats are predicting the Affordable Care Act to be the "second coming." The debate is coming to a fever pitch again because the new healthcare exchanges are about to come to fruition.

INDUSTRY PULSE

Will healthcare exchanges reduce premiums in the long run?
  • 1. Yes
  • 2. No

A healthcare exchange is an online marketplace where insurance companies will showcase various insurance plans so consumers can compare and contrast different levels of coverage and how the premiums change based on that coverage. The idea is that by allowing consumers to see what one insurance company will charge versus another in one setting, the consumer will choose the one with the best price, thereby increasing competition and encouraging insurance companies to lower their rates.

Starting Oct. 1, consumers will be able to go online and view these different plans. They can enroll if they don't already have coverage or if they want to switch from their existing coverage. Coverage obtained from the healthcare exchange will go into effect Jan. 1, 2014. Now that the Oct. 1 date is nearing, some state exchanges have released their plan options and their associated premiums from participating insurance companies on the exchange.



My assumption was with this increased competition, premiums would go down. Apparently, that's not the case. Critics and supporters alike all agree premiums will go up, but the amount they'll go up is apparently up for debate.

The Editorial Board of the New York Times recently praised Obamacare based on early reports from Covered California — the California healthcare exchange. They were pleased that Blue Cross-Blue Shield would only raise premiums 13 percent. Why are they happy with a 13 percent increase? I thought premiums were supposed to go down.

In a recent Forbes article, Avik Roy quotes a press release from Covered California that "the rates submitted to Covered California for the 2014 individual market ranged from 2 percent above to 29 percent below the 2013 average premium for small employer plans in California's most populous regions." Peter Lee, the executive director of Covered California said, "This is a home run for consumers in every region of California." According to Roy, this is misleading. Obamacare will increase individual-market premiums by an average of 116 percent based on his analysis.

So I don't know what to believe, but keep in mind even the most ardent supporters agree premiums will go up, and they're busy patting themselves on the back. I just hope they don't break their arms in the process because the cost of their insurance coverage is going up.

Dr. Jonathan Kaplan is a board-certified plastic surgeon and founder/CEO of BuildMyBod, a website that provides consumers nationwide with itemized price estimates on the cost of plastic surgery.