Obamacare insurance plans will be bare bones — and expensive - Health - AEI

Obamacare insurance plans will be bare bones — and expensive - Health - AEI
There's mounting evidence that come fall, the health plans sold through the Obamacare exchanges will be bare bones affairs - with narrow networks of providers to select from, and heavy co-insurance once patients go "out of network."
In many ways these plans will be a throwback to insurance schemes of the late 1990s, when managed care was dominant and restrictive networks standard fare.
With one difference: The Obamacare plans won't be cheap.
Quality of coverage is just one issue. Price is the other. There's mounting evidence that even though the new health coverage will be austere, it'll still be pricey.
Health plans have ample incentives to price the Obamacare coverage high, which is precisely what they're likely to do.
For one thing, insurers will want to protect against the risk that individuals entering the exchanges are those who most need health insurance because of pre-existing illness. If this sort of "adverse selection" occurs, it will raise costs to insurers. To guard against this, insurers are likely to price the coverage at a premium.