Pre-ACA Health Insurance Costs vs. Post-ACA Health Insurance Costs

Several years ago, back in 2006, I bought the book, The New Health Insurance Revolution, by Paul Zane Pilzer, and I’m so glad I did, because I wanted to look back and see what health insurance costs were back then, vs. what they are today. It serves as a good reminder that high risk pools did work, and helped keep insurance costs low for the masses of healthy insurance buyers. It also reminds us that high risk pools, while more expensive than insurance plans offered to the healthy, can be offered on a sliding scale of income and still be affordable, even for those with pre-existing conditions.  (Note: Pre-ACA, Cover Colorado, for example, was offered on a sliding scale of income. Rates shown in picture below do not display sliding scale discounts). What the ACA did was essentially turn Health insurance into a costly high risk pool for everyone. This is evident by comparing historical insurance costs to the cost of insurance today.

See the following pictures. Rates are based on a 33 year old person with similar individual deductibles.

2006-From The New Health Insurance Revolution 


Direct primary care is the free market applied to health care

When I share information about Direct Primary Care with others, I’m often met with fierce resistance and disbelief. I’ve even been told that I’m full of, well, you know what!  So today, when I saw this interview with Dr. Josh Umbehr of Atlas M.D. I couldn’t wait to share it!  Dr. Umbehr shares with us the highlights of Direct Primary Care and how the revolutionary healthcare model is changing the way Americans receive their primary care.

Dr. Josh Umbehr on the Rapid Growth of Direct Primary Care

“Direct primary care is the free market applied to health care. It’s medicine finally taking the best elements of other business models such as Amazon Prime, Netflix, and Hulu and applying them to an industry that’s ten or fifteen years behind the rest of the world in terms of business structure. It brings a very high-value, low-cost model to the masses.”

Here are some of the highlights of Direct Primary Care and how it saves money for the masses and fixes access to care, by far the most agregious problem in the healthcare systems of “every other developed country”, as well as in America. (Quotes below from Dr. Josh Umbehr in his interview by Tim White of the Objective Standard)

  1. Direct Primary Care brings a membership model to healthcare: “We charge $10 per month for kids, or $50 to $100 per month for adults, based on age.”
  2. Direct Primary Care lowers the cost of health insurance, because it removes the cost of basic care from insurance, saving insurance for the catastrophic claims it should be used for: “Direct primary care makes insuring the routine 80 percent of your health care unnecessary.”
  3. Direct Primary Care lowers the cost of procedures, prescriptions, labs and x-ray: “My best example is an EKG—it costs thirty-six cents, so we do it for free. The coffee in the waiting room costs more than that.” “Just as Amazon can use its size, technology, and resources to find the best prices for me, we can do the same for patients when it comes to medications and labs. We can get those things wholesale at giant savings, sometimes up to 95 percent off.”
  4. Direct Primary Care saves money for the chronically ill and those who might need high tech imaging such as CAT, PET or MRI: “A diabetic patient may have trouble getting his A1c testing covered because it’s expensive. We can do that test for $2.25. It’s $150 at most other places. A diabetic can get a thousand pills of Metformin—more than a year’s supply—for $11.” “We may not have in-house the orthopedic surgeon who does the surgery, but we can certainly do the MRI that the surgeon will need. Instead of $3,000, we do it for $300.”
  5. Direct Primary Care provides quality healthcare: “There’s “cost-effective” health care, which would say, “Don’t do mammograms until you’re forty-five or fifty,” depending on what guideline you use. Well, if you have a family history of breast cancer and you’re worried about it, you might start doing mammograms at forty. Some people will say you’re not cost effective, but I say, “That’s what the patient wanted, and it’s $75 for a mammogram through a direct primary care provider. She can comfortably afford it, and it buys her peace of mind—that’s quality care.”
  6. Direct Primary Care provides value to its patients: “The nausea medicine Zofran, prescribed to pregnant women for morning sickness, is around $120 for thirty pills. We get it wholesale for $2.65.” “Doctors can order brand-name newborn diapers wholesale for $0.02 per diaper. We can get a case of 240 diapers for even less at $3.77—it sells for $38 on Amazon.” DPCs resell wholesale items like diapers and prescriptions to their patients at cost; they do not mark them up.
  7. Direct Primary Care routinely saves patients thousands on emergency or urgent care.  Consider this tweet from a Dr Janice M Hudson, MD.

In conclusion, we as Americans can do better than “other developed countries”, and what makes us different is freedom.  If the government would allow us to buy wraparound insurance to protect us from unforeseen catastrophes, healthcare in America would once again become affordable for the masses, freeing us from waste so that we could use money saved to protect those who are truly in need.




A Healthcare Revolution is Upon Us

I joined my husband in the health insurance industry in 2001, when my husband was looking for an assistant. Before that, I was a technical analyst at Oracle Corporation. The career in employee benefits administration, and later consulting, fell into my lap, providing me with a flexible schedule and the ability to spend more time with my children. When I was starting out, my job involved spreadsheeting lots and lots of quotes for small businesses. Later, I began helping individuals who had no access to employer coverage choose a personal health insurance plan, and today, I spend most of my time managing the group benefits of many small employers. Year after year, I watched as the government’s legislatve intervention resulted in ever-increasing premiums that drastically outpaced the inflation of other goods and services. Some of these included:

  • Modified community rating
  • Mandatory benefits
  • The removal of tobacco status as a means to adjust health insurance premiums
  • The removal of gender discrimination from rate filings
  • Mental Health Parity-forbidding insurers from offering plans without mental health coverage or plans with fewer mental health benefits than physical health benefits
  • Laws forbidding insurers from “up-rating” or “excluding” certain pre-existing conditions, which had the negative consequence of insurers just denying a policy altogether rather than just charging a higher premium to adjust for the added risk or offering a policy with condition specific exclusions. (personal health insurance market only)
  • Laws forbidding insurers from offering policies without maternity coverage in the personal health insurance market.
  • And then finally…The [un] Affordable Care Act

On the surface, it would seem as if all of these “consumer protections” were absolutely necessary, however, for the vast majority of people, being able to choose plans that suited their needs allowed for more affordable options not available in today’s market. Rarely was I ever unable to place an individual with a suitable plan, even people with pre-existing conditions.  In fact, I can’t think of a single time that I was unable to place someone with a plan that could meet their needs.  Of course, pre-ACA, my state was one of the many that offered high-risk pool coverage, so in the rare event that someone had allowed themselves to have a lapse in coverage and also had a pre-existing condition that resulted in either an unacceptable offer of coverage or a coverage declination, Cover Colorado was there.

Fast forward to 2018.  We are now at a point where consumers can no longer bear the cost of ever increasing health insurance premiums, which has basically been the result of the removal of all risk from the purchase of health insurance, turning health “insurance” into nothing more than pre-paid healthcare.  The population is polarized over whether we should try to retain some semblance of a private healthcare system or throw our hands up and beg the government to save us. When I try to speak about the history of health insurance with those who favor government paid health insurance, I’m often met with cynicism and down right heated anger. How DARE I, a SELF-SERVING HEALTH INSURANCE BROKER, contribute to the problems associated with our “for profit” healthcare system!  Something needs to be done, and it needs to be done now.

But the way I see it, we can either go the way of “every other developed country” and suffer all of the unintended consequences that will surely follow, or we can do things the American way, which involves reflecting upon the mistakes of our past, and reversing them.  When I ask that we reflect upon the mistakes of our past, I mean we REALLY need to look back at the history of events that date all the way back to the Great Depression. Generations have passed, and we’ve lost sight of some of the changes that led to rampant healthcare inflation, and thus health insurance inflation, in the first place. I could paraphrase the details, but these historical events have been recollected in great detail by the writings of three of my favorite healthcare history experts:

We’ve got some serious decisions to make, and as an American, it’s your duty to study our history, learn from our mistakes, and fix them.  There’s no easy way out.  America is in a unique position to do something that no other country has ever tried.  The healthcare financing revolution has begun. How can we do it better than any other country?