Consumer Fraud Alert: Obamacare Exchange Policies

Consumers should think twice before going online to check out Obamacare. The policies offered are not only sub-standard, you won’t even be able to tell which ones are worse than others.

Last week, we pointed out that the new exchange insurance policies are not better than those being canceled, despite administration claims.

Among other serious issues, the new policies may not pay doctors as much. If you think that won’t affect you, think again. Doctors will not want you if your policy pays less, or they will spend even less time with you than they do currently.

Most private policies outside the Obamacare exchanges pay more than Medicare. It is already clear that some of the new exchange policies pay far less. In Massachusetts, the Romneycare policies pay just a bit more than Medicaid, and this seems to be the direction the new national exchange policies are headed.

This is compounded because the new policies also restrict, often severely, the doctors you can see or the hospitals you and your doctor can use. If you lose your existing doctor because he or she is not included, good luck finding another one with a policy that pays like Medicaid.

If you read all the fine print, can you get the facts about what your doctor will be paid? No. The insurance company won’t tell you what it pays doctors.

To make it even more complicated, the same policy may pay one group of doctors more than another. How could that be? Because the insurance company may have trouble attracting enough doctors for the pool and will negotiate a special deal with a group it wants. Not only that: the rate it pays may change while you are enrolled.

It’s the same with the doctors included. You might be relieved to see your doctor in the pool, but once you have signed up, that could change.

Keep in mind that Obamacare specifies the services that must always be covered under a policy, including services you may not need. It does not regulate which doctors are included or how they are paid.

If you do check out options on an Obamacare exchange, you should know that anyone eligible for Medicaid will be automatically enrolled. You won’t be shown any private policies and you won’t be given an opportunity to opt out. Like it or not, you are in.

Yes, Medicaid is free. But you will almost certainly lose your present doctor. You may not be able to find another who will take Medicaid patients. And states, which run the Medicaid program, are in many cases cutting what Medicaid covers. In some instances, it may not even pay for more than a day or two in the hospital.

Government provided healthcare also comes with all sorts of restrictions. Regardless of whether you are covered by Medicare or Medicaid, your doctor cannot order blood or urine tests unless he thinks you are ill. If he provides “medically unnecessary” services, he can be prosecuted and put in jail. The government decides what is medically necessary but is not very clear about it. Even if you pay for what you want, such as a vitamin D blood test, the doctor could be prosecuted.

Medicare and Medicaid will also not pay for any conversation by phone or email, will not pay for time spent teaching you how to do anything for yourself, and do not allow the doctor to treat you for two complaints at the same time. Once Obamacare enrolls you in Medicaid, you will be trapped by all these rules, whether you want to be or not.

For now, Medicare will pay your doctor more than Medicaid, and probably more than an Obamacare exchange policy, but don’t expect that to last. The Obamacare legislation was partly financed with major cuts to doctor compensation under Medicare. Those cuts have not happened yet, but when and if they do, expect a mass exodus of doctors from Medicare.

It isn’t even clear why we have Medicare and Medicaid programs in the first place. They are essentially medical ghettos into which old people and poor people are herded. Why do it this way?

The government addresses hunger in America very differently. The food stamp program gives people cards that can be used at any store selling groceries. The card holder pays the same price as anyone else and chooses whatever he or she wants.

Why don’t we provide medical assistance for the indigent in the same way? Just give people a medical card and let them buy what they need like anyone else?

We all need food much more urgently than medical care, but the government isn’t using that as an excuse to take over the grocery industry, at least not yet. We should be grateful for that. Can you imagine what a government run grocery store would be like?

What government gives you in Medicare, especially in Medicaid, and now in the Obamacare exchange policies, is a woefully sub-standard product. If private interests offered such products independent of government, or offered them with so little information, they would undoubtedly be charged with consumer fraud. What we have now is government sponsored consumer fraud, and there are no laws or agencies to protect us from it.

The only thing you can do is try to avoid both Medicaid and the new exchange policies if you possibly can.

Hunter Lewis is author of two recent books, Free Prices Now!, about the Fed, and Crony Capitalism in America. He is also co-founder of againstcronycapitalism.org and of Cambridge Associates, a global investment firm.