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Cathey Park of Cambridge, Massachusetts shows her cast signed by U.S. President Barack Obama after he spoke about health insurance at Faneuil Hall in Boston October 30, 2013. The writing on the cast reads,
Since insurance cancellation notices started going out last fall, Republicans have been gleeful. While they obviously love people not having insurance, it gave them a chance to call President Obama out on a lie—"if you like your coverage…". They've been using those cancellations to try to downplay the amazing success of enrollments on the exchanges. Millions of people enroll? Oh yeah? Well, what about the six million who lost coverage?

It's been a constant refrain, and a bogus one. As it turns out, the individual health insurance market—where all these cancellations happened—has constant turnover. That churn is quantified with a new study by Benjamin Sommers, an assistant professor at Harvard's School of Public Health and an advisor at Health and Human Services. Looking at data from the Census Bureau's Survey of Income Program and Participation from 2008-11, Sommers shows just how much volatility there has always been in this market, well before the Affordable Care Act.

Just two-thirds of the people in the sample that Sommers looked at had the same policy after just four months. And after one year, just 42 percent had the same policy. After two years, it was down to 27 percent. The people in the same who lost these non-group policies moved on to coverage with new employers, or ended up in public insurance, a different individual policy, or didn't get insurance again.

To see just how dramatic the changes are in this market, take a look at this graph showing the changes by age group in just one year, 2008:

Percentage Of Nonelderly People With Stable Nongroup Health Insurance Over Time, By Age Group, 2008
In this context, reports that recent cancellations of coverage may affect as many as 4.7 million adults (though precise estimates are lacking) are likely capturing a great deal of the normal turnover in this market. The findings presented here also suggest that overall coverage rates in the United States are unlikely to fall as a result of these cancellations: Most people who left nongroup coverage in this study acquired other insurance within twelve months, even before the ACA offered increased coverage via the Medicaid expansion and tax credits for Marketplace insurance.
And as for the people who did lose their plans under the ACA, Sommers found that 65 percent of them will qualify for subsidies under the new law, and "many of them will experience even larger declines in total out-of-pocket spending because of reduced cost-sharing requirements." So all the claims about "sticker shock" are going to be as overhyped as all the claims about how many people lost insurance because of the law.

Originally posted to Joan McCarter on Thu Apr 24, 2014 at 09:07 AM PDT.

Also republished by Social Security Defenders and Daily Kos.

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Comment Preferences

  •  Many of these policies were marketed as short-term (10+ / 0-)

    gap-fillers -- such as students who graduate in May and don't qualify for their employer's coverage until December, so they need a cheap bare-bones (or junk) six-month policy. They aren't intended as the kind of coverage you keep year after year. Some of them even limited how many months you could renew them.

    They were also junky enough that most people dropped them as soon as a better option came along.

  •  Wish we had competition in NC. :( (11+ / 0-)

    Blue Cross pretty much owns the market here.

    No big savings here.  Move along.  Move along.

    But at least there is coverage (and subsidies) for folks who didn't have it before!

    Happy little moron, Lucky little man.
    I wish I was a moron, MY GOD, Perhaps I am!
    —Spike Milligan

    by polecat on Thu Apr 24, 2014 at 09:38:45 AM PDT

    •  Me ! (12+ / 0-)

      I have coverage !
      First time I've ever bought health insurance in my life & I'm closing in on 60 !!

      Now I need to use it !

    •  Rates would, as some have researched, be on (1+ / 0-)
      Recommended by:

      average $40.00 to $60.00 less per policy, per individual if we had Medicaid in NC.  

      The real crime in NC is the number of citizens that fall below the minimum of the federal ACA guidelines and do not qualify for any coverage.  They can't get insurance via the ACA because they have incomes to low, and can't purchase insurance because they cannot afford it out of pocket because their incomes are to low.

      Most of my neighbors here in the mountains that are not on any Federal Assistance programs, or disability are uninsured because of what I described.  

      “My soul is from elsewhere, I'm sure of that, and I intend to end up there." - Rumi

      by LamontCranston on Thu Apr 24, 2014 at 02:03:17 PM PDT

      [ Parent ]

    •  I've actually been wondering (1+ / 0-)
      Recommended by:

      if the monopoly BCBSNC has on all the new policies in NC will, in fact, end up saving people money. I've been with BCBSNC for 12 years and switched to a new ACA policy in January. By peculiar coincidence, I had my first major medical issue ever in February (appendectomy). There were obviously a ridiculous number of claims filed, and I was amazed at how much BCBSNC was able to knock down the Duke Hospital rates. The biggest claim was for $28k, and BCBSNC got it down to $11k of which I had to pay nothing. I think I paid $168 total. If one insurance company has all the patients, it seems they might be in a position to do some serious bargaining-down of provider rates is my point. Also keep in mind that I know very little about the health insurance and provider market.

      •  You're theory. (0+ / 0-)

        Yes, any large insurance company with lots of assets and lots of customers should have significant leverage by which to negotiate much more affordable rates with medical service providers.  But for one that has a functional monopoly in its coverage market, there is little incentive for them to pass along any such savings to their policyholders.  In which case, they'll simply pocket the difference.

        Therein lies the value of the ACA - by compelling insurers to compete with one another to a degree that the market itself never required, it's already effectively lowering costs to the consumer.  Ironically, it took so-called "government intervention" to accomplish what free-market ideologues have always claimed that an unregulated market would accomplish...on its own.

        All that is necessary for the triumph of the Right is that progressives do nothing.

        by Mystic Michael on Fri Apr 25, 2014 at 07:13:06 PM PDT

        [ Parent ]

  •  Young person living in my household got (5+ / 0-)
    Recommended by:
    JBL55, elwior, Lujane, whaddaya, Limelite

    a Medical card.  Now we can resume teeth cleaning!

    ...Son, those Elephants always look out for themselves. If you happen to get a crumb or two from their policies, it's a complete coincidence. -Malharden's Dad

    by slowbutsure on Thu Apr 24, 2014 at 10:57:03 AM PDT

  •  fewer than 1 million are uninsured (3+ / 0-)
    Recommended by:
    elwior, whaddaya, Limelite
    3/31/14.....fewer than 1 million people who had health plans in 2013 are now uninsured because of cancellations.
    Insurance companies that issued the cancellation notices say they've retained "the vast majority" of their old customers, mostly by moving them into new, compliant, plans.


    "Tax cuts for the 1% create jobs." -- Republicans, HAHAHA - in China

    by MartyM on Thu Apr 24, 2014 at 11:43:48 AM PDT

  •  Joan you keep stealing my thunder (3+ / 0-)
    Recommended by:
    Lefty Coaster, cocinero, Just Bob

    Also my lightning, sunshine and rain.

     I mean every time I want to post something on Social Insurance at dKos you have gone ahead and done it sooner, better, certainly more eloquently and (really importantly) with a lot more potential page views by Kossacks.

    Oh well, I guess they too serve who stand and Republish.

    But really on this topic you are outshining even Digby. And there is no greater praise chez-Webb. Thanks for everything you do.

    SocSec dot.Defender at - founder DK Social Security Defenders Group

    by Bruce Webb on Fri Apr 25, 2014 at 07:54:17 AM PDT

  •  The insurance companies like that turnover (0+ / 0-)

    Or they used to like it.  It used to be a small group would get offered a good rate IF the group 'passed underwriting' -- I think that's the term the insurance companies used for checking everyone's health before they first offer a policy.  Once the group is in, the insurance company usually can't make everybody submit medical records again; but the company can raise rates.  After a year or so, they'll start raising the rates they charge.  If everyone in the group is still healthy, the group will likely switch to a new company that will offer a better deal -- after sniffing over everyone's medical history, something the current insurer isn't allowed to do.  
    The rapid turnover of who insures whom meant any group with a 'bad risk' -- someone with an expensive disease -- would pretty soon be stuck paying a lot.

    Now with the ACA banning setting rates by how healthy or sick a group is, insurance companies may quit the system of churning their clients.  They're probably already looking for another way to game the system.

    We're all pretty strange one way or another; some of us just hide it better. "Normal" is a dryer setting.

    by david78209 on Fri Apr 25, 2014 at 06:42:01 PM PDT

  •  I've been making the same point for months... (0+ / 0-) every opportunity, every time this bogus GOP meme raises its pointy little head.  And I wasn't even arguing from a research study - just personal experience, observation...and common sense.

    Of course insurance policies got cancelled as the ACA was being implemented - because insurance companies are continually canceling and shifting policies anyway, and have done so for many, many years before the ACA was ever envisioned.  At least now when their policies get cancelled, customers will have multiple options for replacement policies, most of which are much more affordable than anything they had before.


    All that is necessary for the triumph of the Right is that progressives do nothing.

    by Mystic Michael on Fri Apr 25, 2014 at 06:43:40 PM PDT

  •  Claims? Overblown? (1+ / 0-)
    Recommended by:

    joamnc, there's no reason to mince words.

    They are goddamned fucking liars. They have always been goddamned fucking liars.

    From the contemptuous corruption of Grant to Rutherford B. Hayes' stolen election of 1876 to McKinley's "splendid little war" to Harding's Teapot Dome scandal to Calvin Coolidge's laissaz-faire pro-business ass-licking to Hoover's refusal to stimulate (skipping over Ike's mostly positive record, spotty nonetheless) to Tricky Dick to Ford's ineffective Whip Inflation Now! to the Saints of the New Gilded Age that followed...

    They were and are and always will be goddamned fucking liars. Truer words were NE'ER spake.

    "I feel a lot safer already."--Emil Sitka

    by DaddyO on Fri Apr 25, 2014 at 07:34:59 PM PDT

  •  I've said it before and I'll say it again. (0+ / 0-)

    When it comes to these bogus complaints and phony horror stories about Obamacare, especially the ubiquitous "cancellations," the one common thread is this: Most people are either mistaken, unaware, deluded or lying about what they had before.

  •  My own favorite along that line was - still is - (0+ / 0-)

    the woman who has been rather regularly trotted out by the ANTI-anything-Obamaesque claque for "losing her insurance", by cancellation, "because" of the ACA.

    When presented with the FACTS about the new policy she was entitled to buy under ACA - at immense savings, both in monthly premiums and in "cap" amount for her own expenditures - her reply was a corker:  "I don't believe it; so it can't be true."

    And that, friends, sums up the whole Teabaghead/Republican Party opposition to ACA!

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