MONEY Health Care

What Consumers Should Know About Rising Health Care Costs

A conversation with Steven Brill, author of "America's Bitter Pill," on what Obamacare did—and didn't do—for consumers.

In 2013, Steven Brill brought new clarity to the American health care system with his award-winning TIME cover story, “Bitter Bill: Why Medical Bills Are Killing Us.” Now he’s out with a new book on the same theme: “America’s Bitter Bill: Money, Politics, Backroom Deals, and the Fight to Fix Our Broken Healthcare System.” In it, Brill explores how the American health insurance system has evolved, the special interests that shaped the Affordable Care Act, the slow and troubled implementation of health care reform, and challenges we still face. He spoke to MONEY reporter Kara Brandeisky about his book and the key takeaways for health care consumers. (TIME and MONEY are sister Time Inc. publications and share a website. This conversation has been edited for length.)

MONEY: Your book is a comprehensive look at how the Affordable Care Act came to be. But it starts with this personal story about the experience you had as a health care consumer. How did your own open-heart surgery influence the way you thought about health care policy?

BRILL: Well, it sort of drove home something that I knew intellectually, which is that if—when—you’re a consumer in the health care marketplace, it’s not like being a consumer in any other kind of marketplace. We like to live in the illusion—or some people do—that health care can be bought and sold on the market the way any other product can because consumers can make a choice and they know what they’re doing and all the rest of it.

And the fact is that when I was lying there on that gurney, I didn’t know—and I didn’t care—what the price of anything was. I had no idea what I needed. I had no idea what the bills were going to be. When I got the bills, I had very little idea of what they meant—and I’m supposed to be, you know, an expert on this now. And when I got my explanations of benefits, not only did I have no idea, but—as you read in the book—the CEO of United Healthcare had no idea what it meant.

Who should Americans hold responsible for rising prices?

The members of Congress that, for example, passed a law that doesn’t allow Medicare to negotiate the price of prescription drugs. The members of Congress and local legislators and regulators that allow so-called nonprofit hospitals to enjoy very high profits and charge $77 for a box of gauze pads. It’s a matter of the United States deciding that it is going to join the rest of the developed world in controlling health care costs because it is not a free market that can function as a free market.

Obama said in his State of the Union that health care inflation is at its lowest rate in 50 years. [Former director of the White House Office of Management and Budget] Peter Orszag responded to your book, “The cost curve in health care is bending more drastically than I even believed possible in the fall of 2009.” What’s your response to that? Do you think we’re making enough progress at this point?

No, we’re not. And as the book recounts, Peter Orszag and his staff, until the very end, were writing memos complaining to the President and to the political staff that there’s next to nothing in this law that’s going to control costs. So he sort of is on both sides of the issue. And, you know, Peter wrote another piece in Bloomberg several months ago complaining that the law’s panel that was set up to judge comparative effectiveness is doing nothing to judge the comparative effectiveness of expensive treatments, and it’s time that we do something about that.

But saying health care inflation is low is not saying that costs are coming down. It’s just that health care inflation is now maybe two or three times overall inflation in the United States. And all that data that they cite are from the years 2011, ’12, and ’13, which are all before the core of Obamacare, the exchanges, even went into effect at the beginning of 2014. So I don’t know what they’re talking about.

But more important, if you take the trouble to read the law, all 965 pages of it, you will be hard-pressed to find anything except at the edges that does anything to address cost. There’s nothing in there that addresses prescription drug costs. There’s nothing in there that addresses what hospitals can charge and profits of hospitals, except for one provision that allows the IRS to restrict the billing collection practices of nonprofit hospitals for people who need financial aid.

And that is a provision—it’s very important. It’s a big deal. Senator Grassley, a Republican from Iowa, is the one who added that provision to the law. And that provision could have taken effect in March of 2010 when the law was passed, and it took the Obama Administration nearly five years, just until very recently, to write the regs to put that into effect. I could have written those regs in an hour and a half.

I thought some of the saddest stories in your book were about sick people who were burdened with outrageous bills because the Affordable Care Act regulations weren’t in effect yet or they hadn’t been written. What took so long?

You tell me. One of the motifs of the book is that the Obama people, from the President on down, are maybe really good at policy, but they’re just really bad at the nuts and bolts of governing. There is no explanation for why it would take five years to write that provision. It is not complex. It’s either that they were still in the grip of the hospital lobby or they were just not paying attention, just the way they weren’t paying attention to launching a website that would work.

You went and talked to Americans who could benefit from health insurance reform, and you found that they were pretty misinformed about some of the basic tenets of the law. What were some of the biggest misconceptions you encountered?

Well, it starts with the notion that this is a government takeover of health care. It’s exactly the opposite. It’s a plan that has its roots in something that Richard Nixon proposed in the 1970s that is a government subsidy of the private health care marketplace. Basically the government is subsidizing millions of Americans—which I think is a good thing—to go buy health care from private insurance companies who are going to insure them for services provided by private health care providers: hospitals, drug companies, medical device makers. So it buttresses the private sector. It certainly doesn’t interfere with it, let alone take it over. That’s one misconception.

The other misconception—and this is the Administration’s fault—is that a lot of the reporting talks about the premiums and says the premiums are $1,000 a month for a certain kind of plan. Well, they are, except for the fact that 87% of the people who are going on the exchanges are getting a subsidy, so that if you’re a family making $60,000 a year, a family of four, that $1,000 a month premium might actually cost you $300 because the government is chipping in a $700 subsidy.

The Obama Administration was really reluctant to talk about that because they were embarrassed that this was a major income-redistribution program, which is what it is. Once upon a time, the Democrats would have been proud of that. Now they’re really gun shy about it. As I point out in the book, just the Medicaid expansion in the law called for more people to get free health care—to get money from the government for health care—than the entire welfare program that Ronald Reagan ran against in 1980. And yet you didn’t see much about that. The Administration didn’t talk about it, and the press didn’t write about it.

In your original TIME story [“Bitter Pill”], chronicled how these hospitals were charging these outrageous prices, and hospital executives are making multimillion dollar salaries. So I think readers might be surprised that in your book, you say a solution is to let these hospital systems get even bigger and start insuring patients, as well. How did you come to that conclusion?

Well, because you’ve only described half of the solution. I say let them do that, but then treat them like the oligopolies or monopolies that they are, and stringently regulate their profits, their prices, even the salaries of their executives. In other words, if they’re going to be monopolies and oligopolies, and they’re going to keep their tax exemption as nonprofits, you can take a much different regulatory stance. I mean, it is totally beyond me that we have antitrust laws on the books that are supposed to regulate monopolies, and yet, Yale New Haven Health System, which is a monopoly by anybody’s definition when it comes to providing health care in New Haven, is not regulated.

And so my answer is, well, not only regulate Yale New Haven, but tell them to sell health insurance. In other words, if I live in New Haven, I’d rather buy my health insurance from Yale New Haven because it’s a great brand, it’s a great hospital. They’ve bought up so many of the doctors and clinics in and around New Haven. They own the Bridgeport Hospital. They own everything. So I could go to them and say, “Here’s my $10,000 a year for my health insurance. You keep me healthy.” And if that happens, they have no incentive to over-test or over-bill or keep me in the hospital an extra day because they’d only be charging themselves for that because they’d be the insurance company. And that all works fine again if there is real regulation, there are ombudsmen in place who really make sure that they don’t skimp on care now that they’ve gotten my $10,000.

But I think that is a realistic solution because it’s happening anyway. All these hospital systems are expanding and buying up doctors’ practices. Something like 70% of the doctors in the country are in practices owned or affiliated with the hospitals, owned by the hospitals or having some financial relationship with the hospitals.

And you also seem hopeful that tort reform could help drive down health care costs.

It would do a decent share of it, because it’s not about malpractice rates. It’s about the fact that if you go into an emergency room today and just use the word “head” as in “I have a headache,” “I fell on my head,” or even “I have to head to the bathroom,” if you use the word “head” you’re getting a CAT scan. And indeed, if you go on Google—or at least it used to be true, I haven’t done it lately—and type in “emergency room CAT scans,” all the ads on the right-hand side will be for trial lawyers. And so hospitals either have the excuse or the reason to over-test. And in the United States, we use CAT scans and MRIs three or four times as much per capita than they do in Germany, in France, in Japan and all those other places. And again, our results are no better.

[Since you’re a lawyer] I’m curious how specifically you think the system could be reformed.

Just have higher bars to lawsuits, penalize the frivolous suits, make it easier to get them thrown out. You could even have special courts which have doctors sitting as jurors. There are all kinds of proposals. The idea is not to make it impossible for someone to collect for actual malpractice, but to drive away the current system where in many places if there’s any kind of a bad result in a hospital or in a doctor’s practice, there’s a lawsuit and people have to settle it to keep going. And what doctors will do and hospitals will do is again they’ll say to someone who talks about a head, “Let’s give him a CAT scan so if anything bad happens we can always say, ‘Hey, we gave him a CAT scan,’ ‘We gave him an MRI. We did all this. We did belts and suspenders.’” That’s your defense. And that’s a very expensive defense for a lawsuit that doesn’t even necessarily happen.

You told [NPR’s] Terry Gross that as costs continue to rise you think there’s going to come a point where “something is going to snap” because “we can’t pay for this.” I wonder if you could talk a little bit more about what that breaking point might look like for consumers.

Well, we’re getting to a point where, in your own health insurance, your deductible keeps going up, your co-pays and your coinsurance keep going up, the amount you have to chip in for prescription drugs keeps going up. And that’s not because the insurance company profits are going up. It’s because their costs are going up, and so they have to keep raising their premiums and your employer can’t afford those premiums.

At some point, that’s going to become—I mean, I think it is becoming—unsustainable for people who even have good health insurance. And by the same token, it’s unsustainable for the federal government to be subsidizing ever-increasing insurance premiums for people who are buying insurance on the exchanges. So there’s nothing in the law that does anything about the core costs, the hospital costs, the drug costs. And it’s going to keep going up, and the share that the taxpayers are paying and that individuals are paying is going to go up even faster. And I think at some point, someone is going to organize a campaign around this.

Fifty years from now, how do you think historians will view the Affordable Care Act and what it did for consumers?

As a milestone, as an important milestone. Because at the bottom line, it went a long way toward erasing a national embarrassment, or disgrace even, which is that we’re the only developed country that hasn’t made some provision for all or most of our citizens to have access to health care. Now, in theory at least, every American has access to an insurance policy that will be affordable—although it’s not as affordable as it should be—and that will cover them part of the way so that they won’t either not get care and therefore have their health in peril, or even their lives in peril, or be sued into bankruptcy if they end up in the emergency room with a $9,000 bill for a bunch of CAT scans and an hour and a half of waiting.

Is there anything else that you hope consumers will take away from your book?

Well, I think consumers reading the book will certainly have a better understanding of how to read their own health care bills, how to complain about them, how to try to do something about them, how to ask the right questions. So there’s a consumer-friendly aspect of the book, too, I think.

What are the “right questions”?

“Why did I need that?” “What did that cost you?” Well, the first thing is, “What does that mean?” since most hospital bills are in code. It took me months to figure out what different hospital bills meant. But now there’s enough of a movement around that, after my article and after the stuff that Libby Rosenthal did [in her New York Times series, “Paying Till It Hurts”], that hospitals are finding they have to answer those questions.

And the power of embarrassment is not to be dismissed. If you start asking your hospital, “What is that mucus control device on the bill that’s $18?” And they say, “Well, that’s the box of tissues you got.” They may say, “You know what? Forget the mucus control device. We’ll take that off the bill.”

MONEY Financial Planning

The Most Important Money Mistakes to Avoid

iStock

Smart people do silly things with money all the time, but some mistakes can be much worse than others.

We asked three of our experts what they consider to be the top money mistake to avoid, and here’s what they had to say.

Dan Caplinger
The most pernicious financial trap that millions of Americans fall into is getting into too much debt. Unfortunately, it’s easy to get exposed to debt at an early age, especially as the rise of student loans has made taking on debt a necessity for many students seeking a college education.

Yet it’s important to distinguish between different types of debt. Used responsibly, lower-interest debt like mortgages and subsidized student loans can actually be a good way to get financing, helping you build up a credit history and allowing you to achieve goals that would otherwise be out of reach. Yet even with this “good” debt, it’s important to match up your financing costs with your current or expected income, rather than simply assuming you’ll be able to pay it off when the time comes.

At the other end of the spectrum, high-cost financing like payday loans should be a method of last resort for borrowers, given their high fees. Even credit cards carry double-digit interest rates, making them a gold mine for issuing banks while making them difficult for cardholders to pay off once they start carrying a balance. The best solution is to be mindful of using debt and to save it for when you really need it.

Jason Hall
It may seem like no big deal, but cashing out your 401(k) early has major repercussions and leads you to have less money when you’ll need it most: in retirement.

According to a Fidelity Investments study, more than one-third of workers under 50 have cashed out a 401(k) at some point. Given an average balance of more than $14,000 for those in their 20s through 40s, we’re talking about a lot of retirement money that people are taking out far too early. Even $14,000 may seem like a relatively easy amount of money to “replace” in a retirement account, but the real cost is the lost opportunity to grow the money.

Think about it this way. If you cash out at 40 years old, you aren’t just taking out $14,000 — you’re taking away decades of potential compound growth:

Returns based on 7% annualized rate of return, which is below the 30-year stock market average.

As you can see, the early cash-out costs you dearly in future returns; the earlier you do it, the more ground you’ll have to make up to replace those lost returns. Don’t cash out when you change jobs. Instead, roll those funds over into your new employer’s 401(k) or an IRA to avoid any tax penalties, and let time do the hard work for you. You’ll need that $100,000 in retirement a lot more than you need $14,000 today.

Dan Dzombak
One of the biggest money mistakes you can make is going without health insurance.

While the monthly premiums can seem like a lot, you’re taking a massive risk with your health and finances by forgoing health insurance. Medical bills quickly add up, and if you have a serious injury, it may also mean you have to miss work, lowering your income when you most need it. These two factors, as well as the continuing rise in healthcare costs, are why a 2009 study from Harvard estimated that 62% of all personal bankruptcies stem from medical expenses.

Since then, we’ve seen the rollout of Obamacare, which signed up 10.3 million Americans through the health insurance marketplaces. Gallup estimated last year that Obamacare lowered the percentage of the adult population that’s uninsured to 13.4%. That’s the lowest level in years, yet it still represents a large number of people forgoing health insurance.

Lastly, as of 2014, not having health insurance is a big money mistake. For tax year 2014, if you didn’t have health insurance, there’s a fine of the higher of $95 or 1% of your income. For tax year 2015, the penalty jumps to the higher of $325 or 2% of your income. While there are some exemptions, if you are in a position to do so, get health insurance. Keep in mind that for low-income taxpayers, Obamacare includes subsidies to lower the monthly payments to help afford health insurance.

MONEY Health Care

The Most and Least Expensive Places in the U.S. for Health Insurance

South Franklin Street with Mount Roberts tram car passing overhead in Downtown Juneau, Alaska.
Buy your own health insurance? You're paying top dollar if you live in Alaska. Alamy

A survey of health insurance premiums on the exchanges finds that costs tend to be the highest in rural areas with less competition.

In health insurance prices, as in the weather, Alaska and the Sun Belt are extremes. This year Alaska is the most expensive health insurance market for people who do not get coverage through their employers, while Phoenix, Albuquerque, N.M., and Tucson, Ariz., are among the very cheapest.

In this second year of the insurance marketplaces created by the federal health law, the most expensive premiums are in rural spots around the nation: Wyoming, rural Nevada, patches of inland California and the southernmost county in Mississippi, according to an analysis by the Kaiser Family Foundation, which has compiled premium prices from around the country. (KHN is an editorially independent program of the foundation.)

The most and least expensive regions are determined by the monthly premium for the least expensive “silver” level plan, which is the type most consumers buy and covers on average 70% of medical expenses. Premiums in the priciest areas are triple those in the least expensive areas.

Along with the three southwestern cities, the places with the lowest premiums include Louisville, Ky., Pittsburgh, and western Pennsylvania, Knoxville and Memphis, Tenn., and Minneapolis-St. Paul and many of its suburbs, the analysis found.

Starting this month, the cheapest silver plan for a 40-year-old in Alaska costs $488 a month. (Not everyone will have to pay that much because the health law subsidizes premiums for low-and moderate-income people.) A 40-year-old Phoenix resident could pay as little as $166 for the same level plan.

That three-fold spread is similar to the gap between last year’s most expensive area — in the Colorado mountain resort region, where 40-year-olds paid $483—and the least expensive, the Minneapolis-St. Paul metro area, where they paid $154.

Minneapolis remained one of the cheapest areas in the region, although the lowest silver premium rose to $181 after the insurer that offered the cheapest plan last year pulled out of the market. Premiums in four Colorado counties around Aspen and Vail plummeted this year after state insurance regulators lumped them in with other counties in order to bring rates down.

Cynthia Cox, a researcher at the Kaiser foundation, said the number of insurers in a region was a notable similarity among both the most and least expensive areas. “In the most expensive areas only one or two are participating,” she said. “In the least expensive areas there tends to be five or more insurers competing.” She said that other factors, such as whether insurers need state approval for their premiums and the underlying health of the population, may play a role as well in premiums.

The national median premium for a 40-year-old is $269, according to the foundation’s analysis.

Alaska’s lowest silver premium rose 28% from last year, ratcheting it up from 10th place last year to the nation’s highest. Only two insurers are offering plans in the state, the same number as last year, but the limited competition is just one reason Alaska’s prices are so high, researchers said. The state has a very high cost of living, which drives up rents and salaries of medical professionals, and insurers said patients racked up high costs last year.

Ceci Connolly, director of PwC’s Health Research Institute, noted that the long distances between providers and patients also added to the costs. Restraining costs in rural areas, she said, “continues to be a challenge” around the country. One reason is that there tend to be fewer doctors and hospitals, so those that are there have more power to dictate higher prices, since insurers have nowhere else to turn.

By contrast, in Maricopa County, Phoenix’s home, the lowest silver premium price dropped 15% from last year, when Phoenix did not rank among the lowest areas. A dozen insurers are offering silver plans. “Phoenix, during the boom, attracted a lot of providers so it’s a very robust, competitive market,” said Allen Gjersvig, an executive at the Arizona Alliance for Community Health Centers, which is helping people enroll in the marketplaces.

The cheapest silver plan in Phoenix comes from Meritus, a nonprofit insurance cooperative. The plan is an HMO that provides care through Maricopa Integrated Health System, a safety net system that is experienced in managing care for Medicaid patients. Meritus’ chief executive, Tom Zumtobel, said they brought that plan’s premium down from 2014. The insurer and the health system meet regularly to figure out how to treat complicated cases in the most efficient manner. “We’re working together to get the best outcome,” Zumtobel said.

Katherine Hempstead, who oversees the Robert Wood Johnson Foundation’s research on health insurance prices, found no significant differences in the designs of the plans that would explain their premiums. “In most of the plans – cheap or expensive – there seemed to be a high deductible and fairly similar cost-sharing,” she said.

Highest and Lowest Premiums

Here are the 10 most and least expensive regions in the country–with the counties listed in parenthesis–based on premium prices for the lowest-cost silver plan. Regions are counties that share the same price for the same lowest-cost-plan and are either geographically contiguous or are part of the same rating area created by the state.

Premiums are listed for 40-year-olds; and for most states the difference in prices stays the same for people of any age. Vermont and two upstate New York area—Ithaca and Plattsburgh—also are among the 10 most expensive places, although those states do not let insurers adjust premiums based on the consumer’s age, making comparisons inexact. Older residents in those states will end up getting better deals than in most places, while younger ones tend to pay more.

10 Highest Premiums
Region Monthly premium
Alaska (entire state) $488
Ithaca, NY (Tompkins) $459
Bay St. Louis, Mississippi (Hancock) $456
Plattsburgh, NY (Clinton) $446
Rural Wyoming (Albany, Big Horn, Campbell, Carbon, Converse, Crook, Fremont, Goshen, Hot Springs, Johnson, Lincoln, Niobrara, Park, Platte, Sheridan, Sublette, Sweetwater, Teton, Uinta, Washakie, and Weston) $440
Vermont (entire state) $428
Rural Nevada (Churchill, Elko, Eureka, Humboldt, Lander, Mineral, Pershing, and White Pine) $418
Casper, Wyoming (Natrona) $412
Inland California (Imperial, Inyo, and Mono) $410
Cheyenne, Wyoming (Laramie) $401
10 Lowest Premiums
Region Monthly premium
Phoenix, Ariz. (Maricopa) $166
Albuquerque, N.M. (Bernalillo, Sandoval, Torrance, and Valencia) $167
Louisville, Ky. (Bullitt, Jefferson, Oldham, and Shelby) $167
Tucson, Ariz. (Pima and Santa Cruz) $170
Pittsburgh, Pa. (Allegheny and Erie) $170
Western Pennsylvania (Beaver, Butler, Washington, Westmoreland, Armstrong, Crawford, Fayette, Greene, Indiana, Lawrence, McKean, Mercer, and Warren) $179
Knoxville and Eastern Tennessee (Anderson, Blount, Campbell, Claiborne, Cocke, Grainger, Hamblen, Jefferson, Knox, Loudon, Monroe, Morgan, Roane, Scott, Sevier, and Union) $181
Minneapolis-St. Paul (Anoka, Benton, Carver, Dakota, Hennepin, Ramsey, Scott, Sherburne, Stearns, Washington, and Wright) $181
Memphis and suburbs (Fayette, Haywood, Lauderdale, Shelby, and Tipton) $184
North of Minneapolis (Chisago and Isanti) $189

Kaiser Health News (KHN) is a nonprofit national health policy news service.

MONEY Taxes

How Obamacare Could Make Tax Filing Trickier This Year

Affordable Care Act health insurance marketplace navigator Herb Shook pulls up information on his computer to help someone re-enroll in an Affordable Care Act health insurance plan Friday, Nov. 14, 2014, in Houston.
If you got a health insurance subsidy via the online marketplace, you may have more work to do on your tax return. David J. Phillip—AP

For the first time, you'll need to show that you had health insurance last year. For some, that means more paperwork.

In addition to the normal thrills and chills of the income tax filing season, this year consumers will have the added excitement of figuring out how the health law figures in their 2014 taxes.

The good news is that for most people the only change to their normal tax filing routine will be to check the box on their Form 1040 that says they had health insurance all year.

“Someone who had employer-based coverage or Medicaid or Medicare, that’s all they have to do,” says Tricia Brooks, a senior fellow at Georgetown University’s Center for Children and Families.

The law requires people to have “minimum essential coverage,” but most types of insurance qualify.

But for others, here are several situations to keep in mind.

If you were uninsured for some or all of the year

If you had health insurance for only part of 2014 or didn’t have coverage at all, it’s a bit more complicated. In that case, you’ll have to file Form 8965, which allows you to claim an exemption from the requirement to have insurance or calculate your penalty for the months that you weren’t covered.

On page 2 of the instructions for Form 8965 you’ll see a lengthy list of the coverage exemptions for which you may qualify. If your income is below the filing threshold ($10,150 for an individual in 2014), for example, you’re exempt. Likewise if coverage was unaffordable because it would have cost more than 8% of your household income, or you experienced a hardship that prevented you from buying a marketplace plan, or you had a short coverage gap of less than three consecutive months. These are just some of the circumstances that would allow you to avoid the penalty.

In addition, you don’t have to pay a penalty if you live in a state that didn’t expand Medicaid to adults with incomes up to 138% of the federal poverty level $16,104.60 for an individual in 2013) and your income falls below that level.

Some of the exemptions have to be granted by the health insurance marketplace, but many can be claimed right on your tax return. The tax form instructions spell out where to claim each type of exemption.

If you do have to go to the marketplace to get an exemption, be aware that it may take two weeks or more to process the application. Act promptly if you want to avoid bumping up against the April 15 filing deadline, says Timothy Jost, a law professor at Washington and Lee University who is an expert on the health law.

If you don’t qualify for a coverage exemption

If none of the exemptions apply to you, you’ll owe a penalty of either $95 or 1% of your income above the tax filing threshold, whichever is greater. The penalty will be prorated if you had coverage for at least part of the year. The amount of the penalty is capped at the national average premium for a bronze level plan, or $2,448 for an individual in 2014.

The instructions for Form 8965 include a worksheet to calculate the amount of your penalty.

If you received a premium tax credit for a marketplace plan

Under the health law, people with incomes between 100% and 400% of the federal poverty level ($11,490 to $45,960 for an individual in 2013) could qualify for premium tax credits for 2014 coverage bought on the exchanges. If consumers wished, the tax credit was payable in advance directly to the insurer. Many chose that option.

The marketplace determined the amount of premium tax credit people were eligible for based on their estimated income for 2014. At tax time those estimates will be reconciled against actual income. People whose actual income was lower than they estimated may have received too little in advance premium tax credits. They can claim the amount they’re owed as a tax refund.

People whose income was higher than estimated and received too much in advance premium tax credits will generally have to pay some or all of it back. The amount that must be repaid is capped based on a sliding income scale, but people whose income is 400% of poverty or higher will have to pay the entire amount of any tax credit back.

If you bought a plan on the marketplace, you’ll receive a Form 1095-A from your state marketplace by Jan. 31 that spells out how much your insurer received in advance premium tax credits. You’ll use that information to complete Form 8962 to reconcile how much you received against the amount you should have received.

Assuming the information on the form is correct, “It should be easy to reconcile,” says Judith Solomon, vice president for health policy at the Center on Budget and Policy Priorities. Tax software programs and tax preparers should know how to make the calculations, she said.

In addition to using commercial tax software or hiring tax preparer, many lower income consumers and seniors can get free tax preparation assistance through the IRS Volunteer Income Tax Assistance (VITA) and the Tax Counseling for the Elderly (TCE) programs.

Despite resources to help consumers, this first filing season is likely to be bumpy, particularly for people who have complicated family situations or who receive inaccurate information from the marketplace.

“There is just so much confusion out there,” says Jennifer Tolbert, director of state health reform at the Kaiser Family Foundation (KHN is an editorially independent program of the foundation.). “People are going to see these forms and not have any idea what they’re supposed to do with them.”

Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.

MONEY Health Care

How Health Care Is Eating Up Your Paycheck

A new study of employer-provided health insurance shows whopping increases in premiums and deductibles.

TIME Healthcare

Nonprofit Hospitals Seize Low-Income Patients’ Wages

An investigation reveals the ongoing struggles of people too poor to afford health insurance but no poor enough to qualify for Medicaid

Many hospitals in the U.S. receive tax breaks in exchange for the community service of providing care to those who cannot afford to pay. But hospitals in at least five states employ aggressive debt collectors to garnish the wages of low-income patients with unpaid debts, a ProPublica/NPR investigation revealed Friday.

Hospitals in Kansas, Oklahoma, Nebraska, Alabama and Missouri pass debts along to for-profit collection agencies. People affected tend to be those who earn too much to qualify for assistance in states that rejected the Medicaid expansion in President Barack Obama’s health care law, but not enough to purchase health care on their own. The cost of health care services for the uninsured tend to be significantly higher than for people with health insurance.

Read more at ProPublica

MONEY Health Care

Why Getting Mental-Health Coverage Can Be So Tough

Despite rules mandating better insurance benefits, finding care remains a challenge, a new 50-state report concludes.

Even though more Americans have access to health insurance because of the health law, getting access to mental health services can still be challenging.

A new report concludes that despite the 2008 mental health parity law, some state exchange health plans may still have a way to go to even the playing field between mental and physical benefits. The report, released by the advocacy group Mental Health America, was paid for by Takeda Pharmaceuticals U.S.A. and Lundbeck U.S.A, a pharmaceutical company that specializes in neurology and psychiatric treatments.

The report listed the states with the lowest prevalence of mental illness and the highest rates of access to care as Massachusetts, Vermont, Maine, North Dakota, and Delaware. Those with the highest prevalence of mental illness and most limited access are Arizona, Mississippi, Nevada, Washington, and Louisiana.

Among its other findings:

•42.5 million of adults in America, 18.19%, suffer from a mental health issue.

•19.7 million, or 8.46%, have a substance abuse problem.

•8.8 million, or 3.77% of Americans have reported serious thoughts of suicide.

•The highest rates of emotional, behavioral or developmental issues among young people occur just west of the Appalachian Mountains, where poverty and social inequality are pervasive.

Part of MHA’s examination focused on the exchange market and its essential health benefit requirements that guided 2014 coverage. The group found that, while information provided through plans’ “explanation of benefits” might show that there aren’t limits on mental health coverage, limitations including treatment caps and other barriers still exist.

“Parity is in its infancy. Most plans know the numerical requirements around cost-sharing, but few have taken seriously the requirements around equity—around access through networks and barriers to care through prior authorization,” said Mike Thompson, health care practice leader at PricewaterhouseCoopers. “And, in practice, we have a history of imposing much more stringent medical necessity standards on mental health care than other health care.”

However, Susan Pisano, vice president of communications for America’s Health Insurance Plans, an insurance trade group, said the report doesn’t reflect the fact that many health plans have rolling renewals. That means the plans have until Jan. 1, 2015, to fully comply with the parity law.

“Our members are committed to mental health parity, and we’re supportive of legislation, and what isn’t apparent is that benchmark plans represented a snapshot in time … so that doesn’t give us the full picture,” Pisano said. “Our plans have really been working to get in compliance.”

Chuck Ingoglia, senior vice president of public policy at the National Council for Behavioral Health, a Washington-based trade group for community mental health and substance use treatment organizations, said the report’s findings aren’t surprising — though they are troubling. Implementation of the parity law remains a work in progress, he said.

“The law is based on a sound policy premise — that addiction and mental health treatment decisions and management should be comparable to physical health conditions,” he said. “But this also creates a tremendous barrier to proving violations as it requires a consumer to obtain access to plan documents for both types of care, which is frequently handled by different plans,” Ingoglia said.

In addition, the report found that some plans didn’t set out what and how many services were covered. That means consumers would only find out a treatment wouldn’t be paid for by their insurer after they’d already received care.

Americans with mental disorders have the lowest rates of health insurance coverage, so obtaining insurance is a good first step, according to Al Guida, a Washington, D.C.-based lobbyist who works on mental health issues with Guide Consulting Services. But the only way a denial can be reversed is through an appeal, which can be a long and arduous process.

“The vast majority of insurance plans offered on Affordable Care Act federal and state exchanges have close to no transparency, which could lead to abrupt changes in both mental health providers and psychotropic drug regimens with the potential for serious clinical consequences,” Guida said.

Meanwhile, there is a shortage of mental health care professionals—nationally there is only one provider for every 790 people, according to the report.

All of these factors can cause minor mental illnesses to grow more severe, according to Mental Health America CEO Paul Gionfriddo.

He suggested that mental illness should be screened for and covered in the same way cancer, kidney disease, and other illnesses are.

“Right now we’re trapped in a stage where we wait for a crisis, when they’re in advanced stages and then we treat it, and we wonder why it’s so hard to treat it more cheaply,” Giofriddo said.

Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.

MONEY Health Care

5 Things You Need to Know for Today’s Health Care Coverage Deadline

Today is the deadline to buy individual health insurance if you want to have coverage on Jan. 1.

Since open enrollment began on Nov. 15, almost 1.4 million people have signed up for health coverage through the federal insurance exchange, and another 183,000 through state exchanges. With nearly 7 million people already participating, signups are on pace to meet the government’s projection of 9 million enrollees in 2015, according to the Kaiser Family Foundation.

If you’re one of the many who still need to enroll for 2015 coverage, here are five keys things you need to know before you visit your state’s health exchange website.

1. If you want health insurance on Jan. 1, you must enroll today. You still have until Feb. 15 to buy a 2015 plan, but you will have a gap in coverage if you enroll after today’s deadline. Coverage begins on Feb. 1 for people who enroll between Jan. 1 and Jan. 15. Sign up between Jan. 16 and the end of the month, and coverage won’t begin until March 1.

2. Some states are giving you more time and extending the deadline to get coverage by Jan. 1. For example, New York and Idaho’s exchanges will allow users to sign up until Dec. 20. To find out whether you’re eligible for an extension, visit your state’s marketplace exchange website through healthcare.gov.

3. You’ll be automatically re-enrolled if you bought on an exchange last year and do not renew coverage by today. If the health plan you signed up for is no longer offered, insurers can automatically enroll you in another policy similar to the one you have now. But you can opt out of any plan you’re automatically enrolled in and choose another up until Feb. 15.

4. Skip automatic enrollment and shop again, even if you liked your 2014 policy. The Department of Health and Human Services found that more than 70% of people who currently have insurance through the health law’s federal online marketplace could pay less for comparable coverage if they are willing to switch plans.

5. Costs have changed. Many plans will have out-of-pocket spending limits that are lower than the maximums allowed under the health law, according to an analysis by Avalere Health. But the tradeoff for those lower maximums may be a higher deductible, so be sure to pay attention to both figures when choosing your plan. You can also expect to see your premium change. Depending on where you live, that may be a good or bad thing. The premium for the second-lowest-cost silver plan in Nashville jumped 8.7%, while it dropped 15.6% in Denver, according to a study by the Kaiser Family Foundation.

TIME politics

How Obama Bungled Obamacare’s Success Stories

The president's health care plan has saved many lives. So why hasn't he told us about them?

By now, there are thousands of people who can make Barack Obama and the Democrats’ case for the Affordable Care Act. Across the nation, there must be countless tales of Americans who would be broke and broken were it not for Obamacare. They have to exist in all walks of life, in every state, of all political persuasions.

And yet this week, as Monday’s deadline approached for signing up for 2015 health plans, none of those people appeared as part of the pitch. The most frequently aired TV ad features a racially diverse cast of young people speaking in generalities about how their Obamacare plans provided “peace of mind” at a surprisingly low, low price. These folks, none of whom seem to have been sick, gush about the heckuva deal they got and how happy it makes them.

But why? Why is America still being asked to take it on faith that the ACA is a social and moral good? Why does the Obama Administration continue, even after these many years of largely unanswered attacks by Republican opponents, with a failed marketing effort that amounts to, “Trust us! You’ll love it!”

Here’s the ACA ad they should make: a grizzled, Duck Dynasty-like Alabaman stands outside a neonatal intensive care unit. “I was against Obamacare,” he tells the camera. “I sure didn’t vote for Obama, either. And, man, I liked my health plan, wanted to keep it. When I found out I couldn’t, boy was I pissed.” The camera pans to a wriggling baby, tubes everywhere, the man’s wife gazing longingly into the incubator holding their child. “Then my daughter was born, and she almost died,” he says, choking up a little. “My old plan wouldn’t have covered this. We would’ve lost the house, probably would’ve had to go bankrupt. It’s all still pretty dang expensive, I can’t lie. But my Obamacare coverage really saved us. Thanks, Obamacare!”

You think that’s some liberal, nanny-state fever dream? It’s not. This is not conjecture; it is a statistical certainty based on all the data used by insurance carriers to set rates. A certain chunk of the 8 million people who signed on to Obamacare plans – or the millions more whose existing plans were bolstered to comply with the ACA – suffered health catastrophes in 2014. Many opposed the law and were angry when Obama’s “like it, keep it” promise was broken. But without the reform that required comprehensive plans and eliminated rejections of coverage based on pre-existing conditions, many would have met the same fate of so many in recent decades.

That is, lest anyone forget, how it was. Obama, strangely, really never told those stories back then, either. In 2009, when he stood before a joint session of Congress to make his case for health insurance reform, the political genius who campaigned in 2008 with such art and eloquence failed to use the moment to introduce skeptics to a parade of average, hard-working Americans who endured the all-too-common financial devastation of a serious illness. Can’t you see those people, their wheelchairs and colostomy bags and adorable kids, festooning the dais as Obama made his case? How could a purported Judeo-Christian nation see those faces and hear those stories and not agree that something had to change? Instead, the president gave a boring, wonky speech that nobody remembers, a teaser for the incompetent public relations effort to come.

And there they go again. The current marketing effort also failed to appeal to anyone’s emotions or sense of justice. Rather, it insisted that having good insurance makes you feel good about yourself the way, say, eating tofu or reading Tolstoy might. Perhaps Obama once had to rely on unproven predictions, but that ended on Jan. 1, 2014. Since then, ACA supporters have had their pick of uplifting stories of tragedy averted by this law.

Rep. Jan Schakowsky, D-Ill., knows this. Last month, in a Chicago Sun-Times essay, she cited several specific cases of ACA success. Cancer-stricken David Price, for instance, saved $4,000 this year on his meds versus 2013. Gary Wood, bankrupted 18 years ago by the cost of care from a heart attack and then shut out of coverage ever since, underwent a life-saving quintuple bypass in 2014 paid for by the Obamacare Medicaid expansion. And so on. It’s not hard to find these people. They’re everywhere, even in the deepest red of states.

The gang behind this year’s campaign offered up just one limp trick: rebranding. The TV ad, for instance, opens with a woman who says, “Healthcare.gov allows me to continue on with my life.” In other words, it’s not Obamacare. It’s not even the ACA. It’s now just “healthcare-dot-gov,” as if that’s a policy or a government program rather than a place on the Internet. Given that the rollout of the website was among the biggest PR disasters of any sort in recent history, it’s an odd and ineffectual choice.

Stop being so cute. This is really, really easy; just tell the story. It goes like this: Obamacare has successes. It has already saved many Americans from financial doom. It has improved the health care of millions. It has given many entrepreneurs the courage to quit jobs they hated and start new businesses. Here, meet some of these folks. They’re just like you. You could be next.

The evidence is now on Obama’s side. It is mystifying that he doesn’t seem to know it.

Steve Friess is an Ann Arbor, Mich.-based freelance writer and former senior writer covering technology for Politico.

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