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The real story behind out-of-pocket limits

By Dr. Alice Chen
. 1 Comment(s)

We need to clarify the out of pocket maximum delay news that appeared in the NY Times yesterday. As with the other Affordable Care Act delays, this has been blown out of proportion by the media.

Here are the facts:

  1. The ACA sets the out-of-pocket maximum for covered services at $6350 per person and $12,700 for families in 2014.  That's a huge deal.
  2. The out-of-pocket maximum will be in effect for almost everyone. It will certainly be in effect for the new marketplace opening on October 1. So that's all full steam ahead.
  3. However, there are some employers that get separate medical and prescription drug coverage for their employees, often from two different insurance companies. In that situation, your health insurance doesn't know how much money you've spent on your prescriptions, and your prescription insurance doesn't know how much you've spent on your medical bills. Therefore, neither companies knows when you've reached your limit between the two combined, and when it's time for them to cover everything.

    So what will happen if your employer has separate medical and prescription coverage?  You will still have an out-of-pocket maximum, but it will be twice as high as everyone else ($6350 for the medical + $6350 for the drugs).

This is obviously going to be a problem for some individuals and families that use a lot of health care. It needs to be fixed. But HHS knew earlier in the year it would be complicated to get your medical and prescription insurance companies to build a data-sharing system, so it's not happening before January 1, 2014. We always knew we'd have things to adjust in the implementation of such a huge law. It is a bump that does not change the direction of the law in any way.

Bottom line: as planned, the new insurance marketplaces will have a very helpful cap on expenses for individuals and families.  Patients will be protected from medical costs that bankrupt them and make them lose their homes.  As a doctor, that means I can take care of my patients and give them the care they need.  And that's news worth spreading.

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  1. David Lillesand

    (unless it is dry ice - just answer the question as a smart ass lawyer).

    Anyway, THANKS SO SO SO MUCH for getting out your comment on the out-of-pocket medical expense clarification. I have had people already questioning. I re-posted your Facebook note, and am sending out the emails. Thanks. David

    P.S. It was nice to meet you in person at Mona's event in St. Petersburg.

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