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Obamacare premiums: What the price leaves out

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People planning to buy insurance on the exchanges have been waiting for somes clue as to what the policies will cost.

The wait is over. The Obama administration has released a kind of price list for policies that will be sold on the 36 federally run health exchanges, when they open for enrollment on Tuesday. 

Some of the prices are eye-popping. Although the average premium for an individual is $328 a month, a 27-year old in Dallas who makes about $25,000 a year, could buy a lower level bronze plan for $74 a month.

But with insurance, as with many things, the premium is just the beginning.  

“You think you get a really sweet deal on health insurance,” says Georgetown’s Sabrina Corlette.

But the health-policy professor says what looks like a sweet deal, may not be. “The premium is just one dimension of your health insurance cost,” she says.

There are also deductibles — the amount you pay up front, before your coverage fully kicks in.

And there are co-pays — the $20 or $30 payments you have each time you see the doctor — provided, of course, the one you need is in your network. Many of the policies could have fairly limited networks of providers and hospitals. 

“If you need to get specialty care that’s outside of that network, you may have to pay more,” says Corlette.

Prescription costs, which may not be covered, can also be brutal.

“It’s thousands of dollars to a consumer,” says Dan Mendelson, CEO of Avalere Health which released a study today on out-of-pocket costs for policies offered on some of the exchanges.

Mendelson says it’s quite possible people will wind up paying more for medication than for their monthly premiums.

“Our research has shown that patients who face these very high deductibles often abandon their prescriptions at the point of sale,” he says.

Even patients with cancer would skip their medication, says Mendelson, if they have to pay more than $500.

The Affordable Care Act does have annual spending caps of $6,400 for an individual, $12,800 for a family. And most of the policies on the exchange qualify for federal subsidies. But if you can’t afford all the deductibles and co-pays, your insurance might not be worth much, no matter how cheap your monthly premium.

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