• Menu
  • Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar

Before Header

  • About Us
  • Lexicon
  • Contact Us
  • Our Store
  • ↑
  • ↓
  • ←
  • →

Balloon Juice

Come for the politics, stay for the snark.

The willow is too close to the house.

White supremacy is terrorism.

They were going to turn on one another at some point. It was inevitable.

Marge, god is saying you’re stupid.

He wakes up lying, and he lies all day.

When I decide to be condescending, you won’t have to dream up a fantasy about it.

I conferred with the team and they all agree – still not tired of winning!

Authoritarian republicans are opposed to freedom for the rest of us.

When your entire life is steeped in white supremacy, equality feels like discrimination.

Only Democrats have agency, apparently.

Everything is totally normal and fine!!!

Michigan is a great lesson for Dems everywhere: when you have power…use it!

Republicans are radicals, not conservatives.

Republican also-rans: four mules fighting over a turnip.

That’s my take and I am available for criticism at this time.

Perhaps you mistook them for somebody who gives a damn.

Insiders who complain to politico: please report to the white house office of shut the fuck up.

Innocent people don’t delay justice.

He seems like a smart guy, but JFC, what a dick!

This isn’t Democrats spending madly. This is government catching up.

When someone says they “love freedom”, rest assured they don’t mean yours.

Too often we confuse noise with substance. too often we confuse setbacks with defeat.

One of our two political parties is a cult whose leader admires Vladimir Putin.

It may be funny to you motherfucker, but it’s not funny to me.

Mobile Menu

  • Four Directions Montana
  • Donate with Venmo, Zelle & PayPal
  • Site Feedback
  • War in Ukraine
  • Submit Photos to On the Road
  • Politics
  • On The Road
  • Open Threads
  • Topics
  • COVID-19 Coronavirus
  • Authors
  • About Us
  • Contact Us
  • Lexicon
  • Our Store
  • Politics
  • Open Threads
  • 2024 Elections
  • Garden Chats
  • On The Road
  • Targeted Fundraising!
You are here: Home / Anderson On Health Insurance / Tobacco surcharges by age

Tobacco surcharges by age

by David Anderson|  June 27, 20221:29 pm| 5 Comments

This post is in: Anderson On Health Insurance, Open Threads

FacebookTweetEmail

The Affordable Care Act’s individual health insurance markets are priced via modified community rating. Premiums for a given plan in a given area have to the same to any two people of the same age. Premiums are allowed to vary by a factor of 3 for people between ages 21 to 64. Premiums can not vary for medical risk factors with one potential exception. Premiums can vary by 50% for individuals who use tobacco. The rating factor is a function of insurer discretion.

The tobacco surcharge is not eligible for premium tax credits. A smoker whose insurer charges a tobacco surcharge is not able to use premium tax credits to pay that portion of the premium. Therefore, they are not eligible for zero premium plans. The tobacco surcharge is a plausible source of administrative friction. This administrative friction is likely to lead to healthier smokers to not take up insurance and adverse selection to occur.

One of the things I learned last week is that the tobacco surcharge can vary by age. The graph below is from the RATES PUF for 2022 in West Virginia Rating Area 1 for the two insurers that sell plans on Healthcare.gov. Each insurer has a pretty consistent tobacco age curve across their plans (variation at the 3rd and 4th decimal place by age year & plan ID).

Premium surcharge for tobacco use in West Virginia Rating Area 1 for 2022 by insurer for ages 18 to 64.

This is weird and interesting to me. Highmark charges young smokers a de minimas fee that spikes at age 40 and then a steady annual increase to age 50 where is levels off at about 22%. CareSource has a higher initial rate at age 18that has two steps that top off at a younger age and a lower level.

I am curious if there is a strategy here by each insurer to use the variation in the tobacco surcharges to attempt to select and screen for different classes of smokers in the state of West Virginia? I would imagine that CareSource will be relatively more attractive to smokers in their forties or older while Highmark will be much more attractive to younger smokers.  This may be important in states like West Virginia with fairly high smoking rates in shaping their market, but at this point I’m mostly curious and speculating.

FacebookTweetEmail
Previous Post: «Monday Morning Open Thread: It's Becoming A Trend 4 Monday Morning Open Thread: It’s Becoming A Trend
Next Post: Putin: Check’s in the mail… Putin: Check's in the mail...»

Reader Interactions

5Comments

  1. 1.

    planetjanet

    June 27, 2022 at 10:27 am

    They clearly are not experiencing smoking-related health effects on people in their twenties. Just looks like a pure profit motive to me.

  2. 2.

    Rebecca

    June 27, 2022 at 1:27 pm

    My guess is someone did an actuarial study/vibe check back in the day and then never updated it or thought again about their tobacco factor strategy – has the surcharge % changed since 2014? If anyone brought it up the point was made that it is ridiculously easy to lie about it and there is no actual enforcement mechanism.

  3. 3.

    David Anderson

    June 27, 2022 at 1:33 pm

    @Rebecca: Let me look at the 2014 data in a second….

  4. 4.

    David Anderson

    June 27, 2022 at 1:46 pm

    @Rebecca: Looking at the 2017 RATE PUF (https://data.healthcare.gov/dataset/2zrn-hv42/data?conditions%5B0%5D%5Bproperty%5D=statecode&conditions%5B0%5D%5Bvalue%5D=WV&conditions%5B0%5D%5Boperator%5D=%3D&conditions%5B1%5D%5Bproperty%5D=ratingareaid&conditions%5B1%5D%5Bvalue%5D=Rating%20Area%201&conditions%5B1%5D%5Boperator%5D=%3D&conditions%5B2%5D%5Bproperty%5D=rateexpirationdate&conditions%5B2%5D%5Bvalue%5D=12%2F31%2F2017%2012%3A00%3A00%20AM&conditions%5B2%5D%5Boperator%5D=%3D) The curve by insurer/age looks to be pretty damn similiar.

     

    And yeah, I completely agree with you that this is likely an old vibe check with little strategy behind it and even less verification.

  5. 5.

    Amir Khalid

    June 27, 2022 at 7:39 pm

    Here in Malaysia the Government is planning to ban all tobacco sales to those born in 2005 or later. I wonder what the enforcement plan is.

Comments are closed.

Primary Sidebar

Recent Comments

  • Chris on Thursday Morning Open Thread — Nancy Pelosi: Every Day Is A Matter of Life and Death (Apr 18, 2024 @ 9:20am)
  • Uncle Cosmo on Wednesday News Roundup, A Little Late (Apr 18, 2024 @ 9:20am)
  • Baud on Thursday Morning Open Thread — Nancy Pelosi: Every Day Is A Matter of Life and Death (Apr 18, 2024 @ 9:18am)
  • TBone on Thursday Morning Open Thread — Nancy Pelosi: Every Day Is A Matter of Life and Death (Apr 18, 2024 @ 9:18am)
  • WaterGirl on Late Night ‘Should Be Always’ Open Thread: Librarians, Doing Civilization’s Work (Apr 18, 2024 @ 9:18am)

🎈Keep Balloon Juice Ad Free

Become a Balloon Juice Patreon
Donate with Venmo, Zelle or PayPal

Balloon Juice Posts

View by Topic
View by Author
View by Month & Year
View by Past Author

Balloon Juice Meetups!

All Meetups
Talk of Meetups – Meetup Planning
Proposed BJ meetups list from frosty

Fundraising 2023-24

Wis*Dems Supreme Court + SD-8
Virginia House Races
Four Directions – Montana
Worker Power AZ
Four Directions – Arizona
Four Directions – Nevada

Featuring

Medium Cool
Artists in Our Midst
Authors in Our Midst
Positive Climate News
War in Ukraine
Cole’s “Stories from the Road”
Classified Documents Primer

Calling All Jackals

Site Feedback
Nominate a Rotating Tag
Submit Photos to On the Road
Balloon Juice Mailing List Signup
Balloon Juice Anniversary (All Links)
Balloon Juice Anniversary (All Posts)

Fix Nyms with Apostrophes

Balloon Juice for Ukraine

Donate

Twitter / Spoutible

Balloon Juice (Spoutible)
WaterGirl (Spoutible)
TaMara (Spoutible)
John Cole
DougJ (aka NYT Pitchbot)
Betty Cracker
Tom Levenson
David Anderson
Major Major Major Major
ActualCitizensUnited

Political Action 2024

Postcard Writing Information

Balloon Juice for Four Directions AZ

Donate

Balloon Juice for Four Directions NV

Donate

Site Footer

Come for the politics, stay for the snark.

  • Facebook
  • RSS
  • Twitter
  • YouTube
  • Comment Policy
  • Our Authors
  • Blogroll
  • Our Artists
  • Privacy Policy

Copyright © 2024 Dev Balloon Juice · All Rights Reserved · Powered by BizBudding Inc

Share this ArticleLike this article? Email it to a friend!

Email sent!