Health insurance. It’s on the minds of Americans now more than ever, especially since health insurers began implementing the Affordable Care Act (ACA), also known as Obamacare, in 2013. The ACA, and all of the changes that came along with it, have made health insurance more confusing than ever before. And that has people talking.
But as consumers turn more of their attention to health insurance, some facts have gotten a little lost in translation. In fact, you could call them health insurance myths. Lots of people have different ideas about how health insurers operate and how the health insurance industry works.
So let’s look at some common health care misperceptions and the truth behind them.
Myth #1: Insurers oppose health care reform.
Fact: You’d be hard pressed to find a health insurance company that believes we can or should maintain the status quo in health care. It is universally agreed that the traditional health care model is unsustainable for families, doctors, insurance companies and our overall economy. The system just doesn’t provide consumers with enough value for their money. At BCBSNC, we began changing the way we do business well before the dawn of the ACA, moving toward a more patient-centered system that pays for positive health outcomes rather than rewarding doctors for the sheer number of tests and procedures they order.
Myth #2: Insurers make money by denying claims.
Fact: Looking at this in strictly financial terms, insurance companies do better when customers are healthy. From that perspective, it’s in our best interest when you use your health insurance to visit your doctor regularly and maintain good health. And when you do get sick, we want to make sure you have access to the right care at the right time – at an affordable price.
Prevention and wellness are crucial to good health – and to a financially sound insurance industry that can reliably pay consumers’ doctor bills. That’s why so many insurance plans cover 100% of costs for regular physical exams and preventive visits with your doctor, something BCBSNC has been doing for years.
But we don’t view our mission in financial terms. We want our customers to get affordable, quality health care when and where they need it. When that happens, everyone wins: consumers, doctors and insurers.
We want to pay your claims and answer your questions, but we also want to provide you with tools and resources that help you make the best decisions about care for your unique situation. That’s why we offer programs like Blue Connect to help you make the most of your health insurance.
Myth #3: It’s cheaper to pay the penalty than to buy insurance.
Fact: This might be true for your current situation, but there’s no guarantee it will stay that way. After all, that’s why insurance exists. If you’re hurt or need unexpected medical treatments or services, you’ll risk being responsible for thousands more in medical costs than just the penalty. That’s definitely not cheap.
And the penalty’s getting more expensive. During the first year of the ACA, the penalty for not having health insurance coverage was $95 per adult or one percent of your family income, whichever was greater. But that penalty rises every year. If you decide not to buy health insurance for 2016, you’ll end up paying $695 per adult or 2.5 percent of your family income.
Myth #4: Insurance is too expensive for me.
Fact: With rising health care costs, many customers often assume they can’t afford health insurance. But more than 90 percent of our ACA customers who purchased a plan in 2015 received federal subsidies to offset the cost. And in 2017, nearly 72 percent of our ACA customers who enroll through Healthcare.gov will pay less than or the same next year as they’re paying in 2016. Want to see if you’re eligible for a health insurance subsidy? Try this Health Insurance Marketplace Calculator.
Myth #5: Insurers make huge profits.
Fact: After a 2014 net loss of $50.6 million, BCBSNC returned to profitability in 2015. But that doesn’t mean we’re making a huge profit. In fact, we are continuing to lose money on the ACA – $282 million in 2015. A Forbes magazine review of the 10-year period beginning in 2003 found health insurance industry profits fell by half.
Myth #6: My premiums are rising because you’re spending billions on advertising.
Fact: We don’t. But even if we wanted to, we’re not allowed to. The federal government requires that 80 cents of every premium dollar that customers pay must go to paying for customers’ medical costs. That’s a requirement that BCSBNC continually surpasses – in 2014, we spent more than 87 cents of every premium dollar on medical care. Beyond that, we spend less than one-third of a penny of every premium dollar on marketing and advertising, executive compensation and supporting independent foundations combined.
Myth #7: Your shareholders profit from our bad health.
Fact: We don’t even have shareholders. We are a not-for-profit, fully-taxed company.
Helping customers find ways to get and stay healthy is one of the best ways to control health care costs. And when we all work together to reduce health care spending, insurers don’t need to raise rates as much to cover the cost of medical care. Healthier customers are a win-win for all.
Myth #8: Insurers aren’t invested in the community.
Fact: North Carolina’s communities are so important to us, we included them in our mission statement. We’re dedicated to supporting nonprofit organizations in communities across North Carolina that work to make life better for everyone in our state. You may have even heard of some of these programs, such as Get Outside, North Carolina!, Hike NC! and Nourishing North Carolina. Additionally, the Blue Cross and Blue Shield of North Carolina Foundation, our independent philanthropic affiliate, has invested more than $105 million in North Carolina communities since its inception.
Health insurance is complicated. And it’s easy to get confused by what you might hear on the grapevine or in the media. We hope this post helps make sense of some of the things you might have heard.
[Top Image: Shutterstock]