I Can Not Afford It
Yeah, I pretty much can’t afford it. You can stop reading here if you want, but I have some data to back up my reasoning. Enter the rabbit hole with me.
First, I have to say that I welcomed the Affordable Care Act when it was proposed as a single payer system. The way that it would have worked (ideally) is that Medicaid would be the benefit carrier and as long as your doctor accepted Medicaid, you would have some level of service. It would have been a much easier solution to the hodgepodge mess that has been enacted. I’m ahead of myself. Let’s backtrack on how I came to this decision.
What? You Have No Medical Coverage?
You’re damned right I don’t. When I “lost” my job over six months ago, as a part of my package, the company paid for my medical coverage for three months. I made sure that I visited every single doctor imaginable, even ones that I had not seen in years to get every single test covered. I was sufficiently poked and prodded to ensure that I was in perfectly good health because I knew that I would not take the COBRA coverage once my health coverage expired. The plan would cost $440 per month to get the same benefit as when I was employed and it would not have fit into my debt repayment plan.
The good thing is that I’m relatively young and healthy. I don’t have kids and don’t plan on having kids soon. Except for some weird heart failure problem with the men, my family doesn’t have any serious medical issues like cancer or anything. In other words, I took the calculated risk that I could afford to be without health insurance for a few months until the Affordable Care Act (also the “ACA” but better known as “ObamaCare) kicked in.
I’m not alone. The Commonwealth Fund Biennial Health Insurance Survey of 2012 noted that,
Nearly half (46%) of adults ages 19 to 64, or an estimated 84 million people, did not have insurance for the full year or were underinsured and unprotected from high out-of-pocket costs. Two of five (41%) adults, or 75 million people, reported they had problems paying their medical bills or were paying off medical debt. And more than two of five (43%), or 80 million people, reported cost-related problems getting needed health care.
Health insurance is expensive, and sadly, I can’t afford it and neither can many of you. Those “cost related problems” amounted to having to survive every day versus paying for insurance. When faced with the decision between putting a roof over your head and paying for health insurance there can no question with what will win. What would my advice be for someone trying to get out of debt but weighing whether to purchase health insurance? My professional personal finance hat says to get the healthcare, but that would be bullshit because I could not afford to take my own advice.
Time To Sign Up…Almost
I, like you, had followed along the political debates about this plan for months, but I had a vested interest in having the plan pass. I had hoped to launch a small business in the time that I would take off from work and planned on buying into the ACA to regain coverage. There are thousands and thousands of small business owners who have to purchase individual plans for themselves and their families at a steep cost. The best that I hoped for was that the plans in the ACA would be subsidized allowing me to save some money over what I would have paid for COBRA.
Some 56% of New Yorkers under age 65 get their health insurance from their employers. No job, no health insurance. It is estimated that 15% of New Yorkers under age 65 have no health coverage and I am one of them. When October 1 rolled around I was ready to jump on the ACA site like a rabid hyena. I mean, I was ready. But you already know what happened. The site had issues and went down. My state, New York, has its own site NYStateofHealth.com which went down faster than the Titanic. With many uninsured New Yorkers, the site just was not ready to handle the traffic. The state estimated that it received over two million visitors within the first hour that the site was up.
I run a website. I know how it can be when traffic kills a site. I mean, I theoretically I know what can happen. I haven’t been that lucky yet. Anyway, I thought that I would give them a couple of days before trying again. When the site was functional I went back and attempted to sign up. Long story short, the site STILL has no shortage of bugs but I finally made it through the end last week, more than a full month after I first started the process.
Sidebar: Whoever thought of this sucky system where you have to enter all of your information and give a pint of blood before you can see prices needs a stern talking to. That was the most onerous part of the entire process. If people could see prices and then go through the process to see if they would qualify for subsidies and then sign up many of the problems that people have experienced would not have existed.
They have my information and I can see the prices, but WHAT THE HELL.
Lies You Tell
I thought that there were supposed to be subsidies all over the place that would make my health insurance costs very competitive (read: cheaper) relative to the open market. BULL. You see, the way that the system works is that there are subsidies but it all depends on your income, age, health and the state that you live in. Let me translate that for you. It makes no sense to the normal, every day individual.
In New York, for example, younger people will may more because the premiums are not adjusted for age but in other states older people might pay more because the premiums are adjusted for age. In my case, I am going to pay more but will use the system far, far less. The government needs people like me to sign up because I will be covering the cost of care for those who are actually sick and will be going to the doctor and for those who will be getting subsidies. Here’s the other thing, because I am not under 30, I can not sign up for coverage that would just cover catastropic care – the big things like cancer or a heart attack - because they think that it would ultimately cost me more since it would not cover things like if I broke a toe (has happened when some chick in killer heels stepped on my foot in the subway) and need to go to the doctor for that. New York then, would force me to pay for coverage at the full cost because I make too much to qualify for any subsidy. You must make less than 400% of the poverty level to qualify for any subsidy from the exchanges. Your 400% might be different than mine based on your family size.
The cheapest plan that I would be able to purchase is $307.12 per month or $3,685.44 per year which covers about 60% of medical costs after a hefty deductible. If you haven’t looked for yourself SKIP THE GOVERNMENT SITES and use the independent sites that are now available. I use the Health Sherpa because it’s pretty simple and lays out all of the plans in front of you based on your location, age and plan level. The site from the Kaiser Foundation is also really good as well and lays out your costs pretty clearly as well.
So, I can pay the $307.12 for something that covers far less than the COBRA plan from my previous employers. Now, if I purchased something comparable to the COBRA plan the cheapest plan would cost me $443.24 which is on par with the COBRA cost from my employer. No, wait, it’s $3.00 per month more expensive. Nice, huh?
Oh, The Irony
You want to know something a little ironic about me? I’m currently working as a consultant at a software development company as their Benefits Administrator. I’m negotiating with healthcare companies; helping people navigate though trouble with their individual benefits; signing employees up for benefits; auditing benefit bills and building a new benefit structure to help attract employees. In other words I am deeply entrenched into the whole medical care thing because I advise others on what they should do and I can not afford to pay for my own medical benefits.
Sad, isn’t it?
Wait? What Are You Gonna Do?
What the heck can I do? I can suck it up and pay and shove paying a bill or three on the back burner. When the creditors come knocking I will send them to the government. No, that won’t work, but I do have options.
My first one is to sign up for nothing, and many will do just that. If you sign up for nothing and have no medical coverage you will have to pay a penalty of $95 or 1% your federally adjusted gross income that exceeds $10,150, whichever is greater. If I theoretically make $50,000 in a year I’m going to pay $400 for the pleasure of not having insurance. Still, that works out to $33.33 per month which is far cheaper than actually buying insurance. The Congressional Budget Office and the Joint Committee on Taxation estimated that in 2016 six million people will forgo healthcare and just pay the penalty although “a majority of uninsured people will be exempt from the penalty because of hardship, low income or other reasons”. Those same individuals would probably quality for subsidies.
If I’m not taking my chances without health coverage I have two options left:
- Purchase health insurance though a group like Freelancer’s Union
- Get a job, get a job
I’ve been looking at the Freelancer’s Union since 9/11 when my brother decided that he would never work for someone else again. Their plans have improved over the years as they have gained more members. I’m sure there are tons of other groups out there than you can join who have banded together to purchase their own health insurance.
The job option is unfortunately, probably going to pull me out of entrepreneurship and back into working for someone else. I highly dislike the idea of having my health insurance tied to an employer, but as you see from above, the other options are costly. Remember, I’ve been giving you numbers on coverage just for myself. If I had a family or children to pay for the numbers would be far higher. Plus, I am just looking at the premiums here. I didn’t quote the deductible amounts that you have to pay before the plans will cover your care. The numbers quoted are JUST the healthcare premiums whether you go to the doctor or not.
Listen you don’t have to like the Affordable Care Act, but chances are that you are already benefiting from it. If you now have your adult children beyond age 18 or 22 on your health plan, you can thank Obamacare for that. Is your birth control covered without copays? How about your health plan paying for wellness visits without you having to pay a copay for that? Are you a female? They can’t charge you more for your health insurance now. How about being denied specific coverage because of those pesky pre-existing conditions like having high blood pressure, being overweight or being a diabetic? That would not happen as a result of the ACA as well.
Thanks for trying Mr. President. I’ll just sit on the sidelines waiting until we get it right with a single payer system. Until then, I appreciate your efforts but I just can’t afford it.