Obamacare not providing care, transfers $billions to insurance companies?

Is it possible that an unintended outcome of Obamacare is that it has provided Americans with health insurance but not necessarily with healthcare and as a result is it possible Obamacare is transferring tens of $billions to insurance companies while providing little or no care?

As a VITA volunteer, I have been helping low income taxpayers (TPs) file 2014 tax returns in the Princeton, NJ and Philadelphia, PA areas. The 1095s (form 1095 shows the premium tax credit (PTC) the TP received) that I have seen, seem to indicate that the TPs bought mostly bronze plans with the PTC so that they end up paying very little – under $100 – in monthly premiums. Some bought silver plans and paid about $200 per month on top of their PTC for their plans.

As we know bronze plans are HSA eligible meaning they are considered catastrophic plans with high deductibles: typically $2000 to $2500 deductible for an individual and $5,000 to $6000 for a family. In bronze plans all services including doctor visits are subject to deductibles. After the deductible is met, half of all costs must be paid by the insured till the annual maximum out of pocket limit is reached: $6000 for an individual and $12,000 to $13000 for a family. In silver plans, doctor visits require copayments and are not subject to deductibles but medical services, ie, diagnostics/treatments prescribed by the doctor, are subject to deductibles. Surprisingly, silver plans also require $2000 deductibles for individual, $4000 for family and $6000 total out of pocket for individual and $12000 total out of pocket for family.

This means a family of 4 with a bronze or silver plan has to pay all healthcare costs themselves up to $4000 or $5000. After paying $5000 they will have to pay half of all costs till they reach the $13000 total out of pocket maximum. Then after $13000 is reached, the insurance plans will pay for all healthcare costs. If you are making $45,000 a year for a family of four you cannot afford $4000 to $5000 in deductible or $13000 in total out of pocket. So I suspect the low income folks have insurance but end up not affording to see doctors or if they can see a doctor with a sliver plan, they still cannot afford treatment the doctor prescribes as medical services are all subject to plan deductibles.

So what do they do? Perhaps they put off medical treatment or go to the charity care clinics as they did BEFORE Obamacare? The Gallup Poll article “Cost still a barrier between Americans and medical care,” showing more people with private insurance put off treatment in 2014 than in 2013 seems to be consistent with this inference. See Rebecca Riffkin:

Through Obamacare, income-qualified individuals receive a subsidy or PTC to help pay for their health insurance plans. The range of subsidies I have seen appear to be from about $5000 to $10,000 per individual/family. The average PTC according to a public source is about $3000. Multiply by 11 million (estimated number of 2015 subscribers) and you get tens of $billions.

Although the bronze and silver plans provide free preventive or routine care (annual physical, mammogram, colorectal screening, immunization, etc.) that are not subject to deductibles, but do these preventive services really cost $3000 per individual per year? And remember, beyond the the preventive services, the insured really has little or no access to medical treatments or non-routine services as non-routine services are subject to deductibles in the bronze and sliver plans.

Is it possible insurance companies are profiting hugely on PTC payments while they write plans that provide little or next to no medical care because of the high deductibles?

Has anyone else observed this or pointed this out?

Obamacare Impacts: