ELKHART — There’s a lot of uncertainty when it comes to the impact of federal health care reform, from individuals to hospitals to insurance agents.
A glance at several different aspects of life in Elkhart County shows just how much things will change in 8 1/2 months when the government requires everyone to buy insurance.
A family of entrepreneurs
Sara Granberg’s family is trying to figure out what they will do for future insurance.
Granberg alone has insurance through a professional veterinary organization. Her husband, Justin, is a small-business owner, so he and their three children are on separate insurance. “It’s like $800 a month. That’s a mortgage payment,” the veterinarian said.
“Justin’s looking for a job where he can work for someone else to get benefits.”
In fact, she’s going to lose her insurance at the end of the year, so she hopes her husband will have a plan which can cover the whole family. “If I can get on his, I will.”
She’ll be eligible for coverage through the federal exchange next year, but she should expect it to be costly.
Trade group America’s Health Insurance Plans estimates that the average increase in premiums for individuals buying health insurance over the next decade in Indiana is $1,942, or for a family of four, $4,662, thanks to new taxes in the health care law. People buying insurance through employers can expect even higher increases.
The trade group estimates that Michigan residents will see slightly smaller increases than Indiana residents.
Elkhart County taxpayers
The Elkhart County Council should expect $300,000 in extra employee costs for health insurance next year due to reform provisions set to kick in, said County Administrator Tom Byers.
In addition, the county could face roughly $600,000 more, depending on what employees choose who don’t currently take the county’s insurance. They’ll be required to either buy health insurance next year or pay extra taxes, and they won’t be able to go out on the open exchanges since the county provides the option for insurance coverage. That means Elkhart County taxpayers could be on the hook for an extra $900,000 in benefits costs for county employees next year.
IU Health Goshen Hospital
“It’s important to bring community and business leaders together to discuss the challenges going forward,” said Randy Christophel, president and CEO of IU Health Goshen.
The Patient Protection and Affordable Care Act “impacts the way we do business. It impacts the way other organizations do business. In many ways it’s a game changer on every level,” he said.
The hospital is celebrating 100 years in existence this year, and it’s a year of continuing change.
“Our challenge is simple. My job is easy. As we go forward, deliver ever-higher quality services, do it at a lower cost, keep people out of the hospital, get paid less to do it ... a simple challenge,” he joked to a community gathering on the topic of health care Tuesday, April 16.
The speaker at the event, Paul Keckley, said, “I know of nothing in the system as tough to run against such a headwind as a hospital.”
Christophel said his organization wants to change the health of the community in significant ways. “We want to help you ... not to come see us. If we are successful, you won’t come see us.
“We’re going to change dramatically in the next five years,” he said.
They have a multi-disciplinary model of care in specific areas and work with non-profit organizations “that really get at various health needs and safety net-type of capabilities throughout our region.”
“Doing screenings, offering various preventative care items are really important in improving the health of our community.”
“One of the things we’re really building and growing relates to partnerships with employers,” and he expects those changes to continue.
Silas Jessup of InSphere Insurance Solutions said it’s an interesting time to sell health insurance.
“Any time there’s this much volatility, there’s opportunity,” Jessup said. While he doesn’t personally like the law, it’s good for his own business. “We’re representing products that the federal government’s mandating everyone has to purchase. You look at that from an opportunity perspective, that’s a big thing.”
He specializes in insurance for individuals, mostly self-employed people like farmers, contractors, truck drivers, Realtors and hair stylists.
He expects to see small business owners, people with three to 50 employees, opting out of group coverage and sending employees to the federal exchange.
“It’s a monster piece of legislation. When you start looking at the numbers to it ... it was a 2,200-page law to begin with. Now they’re up to 22,000 pages of amendments and interpretations, how-the-hecks and the ripple effect of fallout of all this. It’s really quite insane, the magnitude of it.”
“We don’t know yet. We haven’t been given any guidance on how they want to do this.”
“Probably for older people, 50 to 65, premiums may come down a little bit. Who’s really going to be negatively impacted is younger folks, people in their 20s.” Their premiums may double next year.
To qualify for a tax credit to help pay a portion of the premium, people have to fill out a 21-page application.
“The people who really, I feel are going to be hurt the most, though, are those families or individuals who are over those income thresholds. ... They’re going to have to deal with those inflated premiums and not have any tax subsidies coming back to them,” he said.
“I look at the tax subsidies, honestly, as smoke and mirrors. They’re implementing procedures that are driving the premiums through the roof, it’s not affecting the overall cost. Then they’re taking the tax dollars from those of us who actually pay and throwing it back at the problem to bring the cost down for a certain segment of the population. You’re not fixing the problem there, you’re just covering it up by throwing money at it.”
Premium increases are already happening in anticipation of next year, he said, with high-deductible plans this year renewing at up to 43 percent higher than last year. “They’re just gearing up for Obamacare,” and rates will go up higher next year, Jessup said.
Wendy Labrum started selling insurance in her own independent agency 25 years ago. After all that time, she’s trying to branch out from a health-care specialty because of the changes coming.
“I’m diverting into life insurance, I’ve always done life insurance, but I’m saying ‘More life insurance.’” Vision, dental, short-term and long-term care insurance products are also things on which she’s focusing more.
“When I started in insurance, I started strictly in the senior market. I was selling Medicare supplements.
The inflation for part B, the inflation for the deductibles, the premiums, I have a really hard time looking at these numbers and looking all the way back,” she said. “Today, I don’t know how people are affording this stuff.”
She doesn’t think the reform law is going to help much with the increases. Whatever the impact, she plans to continue to help clients navigate health insurance, “a very personal purchase,” she said.
“Things are unfolding every day,” but next year remains uncertain for the industry, she said. “We’re all kind of waiting to see, but those who think they’ll come in and it’s free, it isn’t going to be free.
“I’ve heard so many people say, ‘You know, when this health care law comes in, I won’t have to pay this stuff anymore.’ I say, ‘You know, really, really sorry that you’re going to be disappointed, because you are going to have to pay,’” she said.
“I used to do an individual health-insurance policy for, let’s say, a 19-, 20-year-old young kid, $78 a month. We’re looking at $200 to $300 a month now, and (reform) hasn’t even hit.”
Reform is “not going to make costs go down,” she said. People should expect premiums to jump another 61 to 106 percent next year, Labrum said. “Whether you buy it individually privately or through the public exchange, it’s going to be high.”
Labrum thinks “their goal is to collapse the insurance industry to make this a one-payer system where the government is in control of everything,” she said.