Vermont: An important letter about #SilverLoading and #SilverSwitching!

Unfortunately, Vermont is one of the three states (along with Idaho and Maryland) which hasn't released any 2019 Open Enrollment data yet, so I don't have any numbers to report on that front. However, they did just post this "Open Letter" which I found interesting. The two things to keep in mind about Vermont are: 1) they include their own subsidies on top of ACA subsidies; and 2) they were among two states (North Dakota is the other one) which upgraded their premium pricing in 2019 from "no load" to full #SilverSwitcharoo status.

You can read about the wonky mechanics of this here, but the bottom line is that Vermont residents who qualify for subsidies have substantially better deals available this year, while unsubsidized enrollees have an important workaround to avoid being stung with extra CSR costs:

An Open Letter to Everyone Who Has Helped Vermonters Get into the Right Health Coverage

As we enter the final week of Open Enrollment, the Department of Vermont Health Access wants to thank you for all you’ve done to help spread the word about this year’s changes. We also want to ask your help with a final push to get Vermonters into the ‘right plans.’

Due to a complex set of policy changes, the federal government is providing a lot more financial help in 2019. This means:

• A family of four earning $100,000 will receive over $3,000 more in financial help than they received in 2018;
• Most uninsured Vermonters have a household income that would now qualify for a zero-premium plan, meaning their financial help would cover their whole monthly premium;
• Many Vermont Health Connect members can save more than a thousand dollars by changing to a different ‘metal level’ insurance plan, per the 2019 Plan Comparison Tool.

With your help over the last few years, Vermont has achieved one of the lowest uninsured rates in the nation. With your help this week, we can drive it even lower.

By helping Vermont’s health insurance marketplace enroll as many qualifying individuals as possible, you support all Vermonters. As individuals, we’re each better off when we aren’t at risk of medical bankruptcy. Collectively, we’re better off -- and our state’s health care system is stronger -- when there is less uncompensated health care.

Many of our members have referenced communication from their state legislators, employers, doctors, community media outlets, neighbors and family members when they apply for coverage or ask to change plans. Many others have worked with one of 300 trained In-person Assisters who live and work in communities across the state. In an age where folks are buried in information and properly wary that an unsolicited call could be a scam, words of encouragement from a trusted source can really cut through the clutter.

Those personal words -- as much as any invoice insert, letter, email, or phone call from Vermont Health Connect, Blue Cross Blue Shield of Vermont, or MVP Health Care – can help Vermonters take the necessary steps to enroll in the right health insurance plan for 2019.

What is the right plan? In theory, it’s the plan that will have the lowest total costs over the course of the year. In other words, the net premium (what the member pays after receiving financial help) plus out-of-pocket costs (what they pay when they receive services) is lower than any other plan. In practice, it’s easier to define the wrong plan.

So, what is the wrong plan?

• For most uninsured Vermonters, the ‘wrong plan’ is staying uninsured. Consider that most uninsured individuals earn less than $30,000 per year and most uninsured couples earn less than $50,000 per year. For 2019, that individual qualifies for a zero-premium plan and that couple qualifies for a $19 plan (92% less than it would have cost them in 2018). If you know someone who is trying to decide between being uninsured and getting covered, tell them to get covered! If they say they’ve checked in the past and can’t afford coverage, ask if they’ve checked this year.
• For Vermonters who are sure their income is too high to qualify for financial help, the ‘wrong plan’ can be a silver plan with Vermont Health Connect. On-exchange silver plans cost much more in 2019, so unsubsidized Vermonters are better off changing to a different metal level plan – for example, gold plans now have a similar premium to silver plans, but lower out-of-pocket costs – or enrolling in a lower cost “reflective silver” plan directly with Blue Cross Blue Shield of Vermont or MVP Health Care.

Note: This is the "switch" part of the #SilverSwitcharoo. Since 100% of the CSR cost has been loaded onto on-exchange Silver plans only, it means that unsubsidized on-exchange Silver enrollees are much better off switching to either a Bronze or Gold plan or to an off-exchange Silver plan. I should note that only around 3% of all HealthCare.Gov enrollees fall into this category; assuming that's representative in Vermont as well, it should only apply to roughly 900 people or so...but it's still important advice for Vermonters currently considering enrolling in ACA coverage for 2019.

For example, here's how much MVP's "Plus Silver" plan costs for a single 40-year old:

• If they earn $48,000/year (just inside the subsidy threshold), it'll cost $371/month on the exchange after a $227/mo subsidy
• If they earn $49,000/year or more (just over the subsidy threshold), they won't receive any subsidy, so it'll cost the full $598/month (ouch).
• HOWEVER, if they earn $49,000/year or more and buy the exact same plan OFF-exchange, rebranded as "Plus Silver Reflective", it'll only cost $493/month

That's a savings of $105/month for the exact same policy.

• For Vermonters who qualify for financial help but have relatively higher incomes – roughly $25,000 to $49,000 for an individual or $50,000 to $100,000 for a family of four – the ‘wrong plan’ can also mean staying in a silver plan. They can likely use their additional financial help to buy a 2019 gold plan for less than they paid for their 2018 silver plan and enjoy the lower out-of-pocket costs that come with gold plans.

This is the "normal" part of #SilverLoading: Since the CSR cost has been loaded onto Silver plans only (raising Silver premiums an average of 10.7 percentage points higher than Bronze or Gold), it also increases the APTC subsidies for those eligible. Since those subsidies can be applied to Bronze and Gold plans as well, you can get a dirt-cheap Bronze or a bargain-priced Gold plan if they earn between 200 - 400% FPL.

In other words, using the example above: That $48,000 single 40-year old would normally only qualify for perhaps $148/month in subsidies, but thanks to the extra APTC boost, they qualify for $227/month instead. Since they can use that $227/month for Bronze or Gold plans as well, they could choose a Gold plan for just $10 more ($381/month)...with a $550 lower deductible and a $1,350 lower maximum out of pocket total.

Basically, Silver Loading means anyone earning 200-400% FPL effectively has at least an extra $79/month in subsidies, or $948/year (this will be higher for those earning 200-300% FPL, or if they have more than one person in the household). Around 1/3 of HealthCare.Gov enrollees earn between 200 - 400% FPL; if true in Vermont, this means roughly 9,000 Vermonters should qualify for bonus Silver Load subsidies.

However, if they earn 100 - 200% FPL, they're still better off with an on-exchange Silver plan:

• Now for the curveball: For Vermonters with relatively lower incomes – up to about $25,000 for an individual or $50,000 for a family of four – the ‘wrong plan’ can be a gold or platinum plan. These Vermonters qualify for additional financial help in the form of lower out-of-pocket costs if they enroll in a silver plan. So, for them, enhanced silver plans still provide the best value.

It can be confusing, but help is available. VermontHealthConnect.gov’s 2019 Plan Comparison Tool has been used nearly 30,000 times this season, up more than 50 percent over last year. Vermonters can then log on and choose their 2019 plan online. For those who prefer phones, the Customer Support Center is open extended hours this week and on Saturday, the last day of Open Enrollment. Yes, call volumes are always high near the deadline but stay on the line and someone will help. If the wait times are long, the team will offer a call back. And rest assured, the health insurance marketplace will continue to work until each member and applicant is in the plan of their choice.

In this time of giving, please give others motivation and information. Help them make informed decisions about one of the most important purchases they will make this month. Thank you.