Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Aetna Inc. (AET), UnitedHealth Group Inc. (UNH): Will Obamacare Really Give You Better Health Insurance?

The Affordable Care Act has promised that everyone will have individual health insurance. Even with universal coverage, however, millions of Americans are worried about what their insurance policies will look like after Obamacare fully takes effect and whether the coverage those policies will provide will be better than what many of them already have.

Aetna (AET)

Right now, it’s not entirely clear what Obamacare-provided policies will look like. But early signs point to a few likely conclusions about how health insurance will change.

1. If you get your insurance outside of work, Obamacare policies are likely to include more benefits.
One likely outcome of the Affordable Care Act is that health insurance plans will have to provide more comprehensive coverage than they do currently. A 2012 study from researchers at the University of Chicago found that among the roughly 14 million Americans who have individual health coverage rather than group coverage through an employer or other organization, more than half of those plans didn’t provide enough benefits to qualify under Obamacare’s standards. The fact that health insurance companies won’t be able to offer such plans was part of why shares of UnitedHealth Group Inc. (NYSE:UNH)WellPoint, Inc. (NYSE:WLP), and Aetna Inc. (NYSE:AET) — all of which offer individual health plans as part of their overall product lines — initially fell when Obamacare became law and was later upheld.

Source: White House.

Under Obamacare, those substandard plans will be replaced by newer coverage. They’re likely to come with higher premiums, especially for those plans that provided much more limited benefits than will be required under the new law. Whether better benefits will provide enough of an offset to result in lower overall costs will vary from person to person and across different policies. People who have minimal health expenses will likely end up paying more overall, while those who use their health benefits more often could see cost savings under Obamacare plans.

2. Those covered under employer-provided plans already have generally strong coverage.
The same study also examined people covered under group plans, typically through their employer. The differences in quality were staggering. The study authors divided different insurance policies into tiers based on how much of a patient’s medical bills each policy would cover. In group plans, almost two-thirds of members had policies that covered 80% or more of their costs, compared to just 2% of those who had to get their coverage individually. Moreover, thanks to employer contributions, those in group plans paid less than half what individual-plan members paid in out-of-pocket costs.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.