Gov Docs: Insurance Cancelled for Increases of $5.36 or More on Cheap Copayments

First was the lie that, if you liked your insurance, you would get to keep it. When that proved extremely untrue, the Administration shifted, stating that people would lose their care only if their insurance "drastically" changed since ObamaCare was adopted. That "drastic" change? Potentially as little as five dollars and thirty-six cents.

According to the document "Group Health Plans and Health Insurance Coverage Relating to Status as a Grandfathered Health Plan Under the Patient Protection and Affordable Care Act," hosted on http://webapps.dol.gov/, the amount of change in some people's pockets could leave them without insurance.

While wordy and extremely long, the document provides several examples in which people can lose their insurance. Any increase in an insurance copay above the rate of "medical inflation" plus 15% leads to an insurance provider losing its "grandfathered" status. Normally, the rate was calculated from about 20 to 40% by the government. So, an increase from $200 to $300 a month would cause a provider to lose its status.

But the thing is, the 20-40% figure applies to extremely cheap insurance as well. In one example, an increase from $30 to $45, a mere fifteen dollars, causes an insurance provider to lose its grandfather status. Here is the example, verbatim from the document:

The increase in the copayment from $30 (the copayment that was in effect on March 23, 2010) to $45, expressed as a percentage, is 50% (45 - 30 = 15; 15 / 30 = 0.5; 0.5 = 50%). Medical inflation (as defined in paragraph (g)(3)(i) of this section) from March 2010 is 0.2527 (485 - 387.142 = 97.858; 97.858 / 387.142 = 0.2527). The increase that would cause a plan to cease to be a grandfathered health plan under paragraph (g)(1)(iv) of this section is the greater of the maximum percentage increase of 40.27% (0.2527 = 25.27%; 25.27% + 15% = 40.27%), or $6.26 ($5 x 0.2527 = $1.26; $1.26 + $5 = $6.26). Because 50% exceeds 40.27% and $15 exceeds $6.26, the change in the copayment requirement at that time causes the plan to cease to be a grandfathered health plan.

But what above even cheaper insurance? What if copays didn't cost you a dime, then were increased? Well, the document covered that to. If you went from a copay of $0.00 to $5.36 or more, you would lose your insurance. Pocket change. The text from the document gives an example in which a five dollar increase does not change the plan. However, 36 more cents would have changed it "drastically" (emphasis mine):

Example 6. (i) Facts. The same facts as Example 5, except on March 23, 2010, the grandfathered health plan has no copayment ($0) for office visits for primary care providers. The plan is subsequently amended to increase the copayment requirement to $5.

(ii) Conclusion. In this Example 6, medical inflation (as defined in paragraph (g)(3)(i) of this section) from March 2010 is 0.0720 (415.0 - 387.142 = 27.858; 27.858 / 387.142 = 0.0720). The increase that would cause a plan to cease to be a grandfathered health plan under paragraph (g)(1)(iv)(A) of this section is $5.36 ($5 x 0.0720 = $0.36; $0.36 + $5 = $5.36). The $5 increase in copayment in this Example 6 is less than the amount calculated pursuant to paragraph (g)(1)(iv)(A) of this section of $5.36. Thus, the $5 increase in copayment does not cause the plan to cease to be a grandfathered health plan.

I'm sure the President's really sorry, though.