Health Insurance Premium Estimates … God Help the Middle and Lower Classes

[pzxc]

http://www.joshuakennon.com/just-saw-obamacare-health-insurance-premium-estimates-god-help-middle-lower-classes/

Is it really this bad?

[beltim]

There are factual inaccuracies in that article.  For example, premium subsidies DO NOT happen once a year - they are taken into account every month that you pay a premium.   Then there are other issues I have with his characterization of the totality of the situation.  Overall, I think it's a pretty bad summary - not deliberately inaccurate, but one that seeks to paint it in a very negative light. 

[r3dt4rget]

The ACA has some great insurance reforms, such as doing away with denials for pre-existing conditions. However, it's an entitlement. People with the ability to pay will end up paying more in premiums to support the people getting subsidies. In the case of the ACA insurance marketplace, most sign-ups qualify for subsides. If you have to buy insurance on the marketplace but do not qualify for subsides, prepare for sticker shock.

I'm thankful my employer offers health insurance, and most American workers are in this situation. But be prepared for the consequences of this law. Employer offered insurance may be a thing of the past. The penalty for not offering insurance costs less than providing insurance. All it takes is one major business to start the ball rolling. One executive to make the smart business move.

[The_path_less_taken]

...
I'm thankful my employer offers health insurance, and most American workers are in this situation. /quote]]







Edited because it keeps putting my comments below in with the above quote...





I can only speak for the places I've worked: NV, CA, NY, WY, and very briefly in Alaska.

Most employers do NOT provide health insurance. And even really big "green" companies like Trader Joe's dropped it for their part time employees due to ACA...which is then priced out of reach for many lower wage workers.

Especially anyone who has a little side income...it's incredibly easy to make more than the subsidy covers.

[The_path_less_taken]

Well....for some reason I'm unable to edit the above post correctly and I keep losing satellite connection so giving up: my comments are below the "edited" part.

[TreeTired]

My wife and I have a subsidized ACA health plan.  We will be paying $360 per month in 2015 after subsidy.   The "list price" on this healthplan, without a subsidy, would be close to $1400 per month (total, for the 2 of us) and at that price would be a ridiculous rip off because there is a $12,000 deductible!!  Doctors visits are a copay and all of our doctors participate, but still I think the plan sucks at list price.   So who is getting ripped off?  The tax payer,  and to me it appears that the insurance company gets the benefit of this rip off but who knows what else is going on.   

[r3dt4rget]

I can only speak for the places I've worked: NV, CA, NY, WY, and very briefly in Alaska.

Most employers do NOT provide health insurance. And even really big "green" companies like Trader Joe's dropped it for their part time employees due to ACA...which is then priced out of reach for many lower wage workers.

Especially anyone who has a little side income...it's incredibly easy to make more than the subsidy covers.

Prior to the ACA employer based insurance was where the majority of Americans got health insurance (54%). 35% were insured by the government (medicaid, medicare). Only a small group, about 10%, of people were forced to buy private insurance by themselves.

[Eric]

10% is a small group?  That's like 31,000,000 people.  If those people all lived in the same state, only California would be more populous.

[r3dt4rget]

10% is a small group?  That's like 31,000,000 people.  If those people all lived in the same state, only California would be more populous.

1 out of 10 is a small group, yes. The number 31,000,000/315,000,000 is large and hard to put into perspective. The original point was that most workers that have to buy insurance get it from work. 54% of people that pay for insurance buy through an employer, while 10% buy without employer assistance. This was in 2013 before major provisions of the ACA went into effect. So in that group of 10 one person has to buy it on their own, 5 people get it through work, 4 people get it paid for through the government. So I reiterate my original point that most people get it from work.

[projekt]

For the working poor, the article seems to ignore the co-pay and deductible support offered on silver plans. A worker making $20,000/year buying insurance on the exchange sees a silver plan with a deductible of perhaps $1000 and co-pays of $5.

[mindaugas]

Speaking from experience, I lose my high deductible plan at the end of 2015 and will have to move to a new plan with a lower deductible but much higher premium. I'd love to keep my high deductible plan and pay less each month for the premium.

[The_path_less_taken]

[/quote]
Prior to the ACA employer based insurance was where the majority of Americans got health insurance (54%). 35% were insured by the government (medicaid, medicare). Only a small group, about 10%, of people were forced to buy private insurance by themselves.
[/quote]



Perhaps. But from my personal experience, smaller communities are weighted in the exact opposite ratio: if you're in a little town or in a semi-rural area, you are sol.

Yeah, I get the MMM "just move" thing now. Didn't at 18. And some people who have had a family farm or whatever for generations feel obligated to stay. As do people with animals.

[Public Hermit]

I am thankful I have healthcare through my employer, but then again, healthcare is a rip-off in this country. I don't see it getting better anytime soon, which is why I must keep an open mind about retiring abroad.

[Jack]

Even employer-provided health care is a rip-off. I'm only responsible for paying 50% of my wife's premium (and 0% of mine), but even that is $280/month. That's $280/month for half of one person's premium -- and that's for a young, healthy person!

[r3dt4rget]

Even employer-provided health care is a rip-off. I'm only responsible for paying 50% of my wife's premium (and 0% of mine), but even that is $280/month. That's $280/month for half of one person's premium -- and that's for a young, healthy person!

It depends on where you work, and what kind of plan you have. I pay $10/month for my insurance through Blue Cross Blue Shield.

[beltim]

I don't think many of you realize how expensive health care is.  The average medical costs in the US for a working age person (i.e. not a child and not covered by Medicare) is about $6,125.¹  About 20% of all health care costs in the US are out of pocket.².  That means about $4900 per year, or $408 per month, going to insurance means that you're paying the average amount proportional to care.  Given that health care spending increases with age, health insurance premiums also naturally increase with age.  And if you're in an employer-provided plan, a lot of employers don't change premiums as you age, so your premium doesn't vary the way it would if you purchased it on your own.



¹http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NHE-Fact-Sheet.html
²http://data.worldbank.org/indicator/SH.XPD.OOPC.ZS

[mindaugas]

I don't think many of you realize how expensive health care is.  The average medical costs in the US for a working age person (i.e. not a child and not covered by Medicare) is about $6,125.¹  About 20% of all health care costs in the US are out of pocket.².  That means about $4900 per year, or $408 per month, going to insurance means that you're paying the average amount proportional to care.  Given that health care spending increases with age, health insurance premiums also naturally increase with age.  And if you're in an employer-provided plan, a lot of employers don't change premiums as you age, so your premium doesn't vary the way it would if you purchased it on your own.



¹http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NHE-Fact-Sheet.html
²http://data.worldbank.org/indicator/SH.XPD.OOPC.ZS

Nope, I acknowledge that and my costs and my family's costs are not even close to that. I also object to having to pay extra to subsidize the average American's health care costs.

[Jack]

I don't think many of you realize how expensive health care is.  The average medical costs in the US for a working age person (i.e. not a child and not covered by Medicare) is about $6,125.

So what? If the entire rest of the developed world is any indication, it shouldn't be that expensive!

[beltim]

I don't think many of you realize how expensive health care is.  The average medical costs in the US for a working age person (i.e. not a child and not covered by Medicare) is about $6,125.¹  About 20% of all health care costs in the US are out of pocket.².  That means about $4900 per year, or $408 per month, going to insurance means that you're paying the average amount proportional to care.  Given that health care spending increases with age, health insurance premiums also naturally increase with age.  And if you're in an employer-provided plan, a lot of employers don't change premiums as you age, so your premium doesn't vary the way it would if you purchased it on your own.



¹http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NHE-Fact-Sheet.html
²http://data.worldbank.org/indicator/SH.XPD.OOPC.ZS

Nope, I acknowledge that and my costs and my family's costs are not even close to that. I also object to having to pay extra to subsidize the average American's health care costs.

And the average person's home insurance vastly exceeds the amount they spend to rebuild their house after a fire.  The whole point of insurance is to protect you against catastrophic losses.  If you're comparing your individual health costs to your health insurance premiums, then you don't understand insurance.  You need to compare the total insurance premiums to total health care expenditure to see if you're getting a good deal, just like other types of insurance.

[beltim]

I don't think many of you realize how expensive health care is.  The average medical costs in the US for a working age person (i.e. not a child and not covered by Medicare) is about $6,125.

So what? If the entire rest of the developed world is any indication, it shouldn't be that expensive!

So the point is that this whole thread is complaining about health insurance costs, and how they don't get enough value out of their policy every year.  This is a fundamental misunderstanding of insurance – if everyone on this thread complained that they spent more on life insurance than they received, there would be widespread mocking.

If you want to complain about health care costs, that's a valid and important concern.  But that's not what anyone here has done.

[Shortbus]

I can relate to the article. Wife and I are mid 30's, healthy, mostly-vegetarian diet, non-smokers, I'm a long distance runner and have a job that keeps me active all day, she runs and takes the baby all over throughout the day. My family has a solid history of longevity too (my 88 yo grandfather's mother is still with us at 109!).

Despite all that our monthly premium for the absolute cheapest bottom of the barrel bronze plan we could get is $808 a month for 2015. I make too much to qualify for any subsidies as well so it's all on us. The plan we had last year was around $715 (again, the cheapest we could get) but the premium for that one jumped to $852 for 2015. It's a pretty helpless and frustrating feeling knowing you pretty much have to have it in case something happens but also knowing that it's pretty damned unlikely that anything is actually going to happen, at least to the extent that we would ever meet the deductible.

[mindaugas]

Ok, so I don't like how the cost of my premium continues to rise while the amount of health care I use goes down. So I want a catastrophic policy to simply cover my assets in case something horrible happens. I don't want the hospital putting a lien on my house. But I can't do that anymore because it is now mandated that I subscribe to a premium with an insurance company which DOES raise the cost of my health care because my insurance premium is part of my health care. ACA made things worse.

[justajane]

I can relate to the article. Wife and I are mid 30's, healthy, mostly-vegetarian diet, non-smokers, I'm a long distance runner and have a job that keeps me active all day, she runs and takes the baby all over throughout the day. My family has a solid history of longevity too (my 88 yo grandfather's mother is still with us at 109!).

Despite all that our monthly premium for the absolute cheapest bottom of the barrel bronze plan we could get is $808 a month for 2015. I make too much to qualify for any subsidies as well so it's all on us. The plan we had last year was around $715 (again, the cheapest we could get) but the premium for that one jumped to $852 for 2015. It's a pretty helpless and frustrating feeling knowing you pretty much have to have it in case something happens but also knowing that it's pretty damned unlikely that anything is actually going to happen, at least to the extent that we would ever meet the deductible.

Why do you think it's "pretty damned unlikely" that something is going to happen to you? Healthy people get sick all the time. Expensive medical procedures can happen to almost anyone. I'm a healthy 37 year old who had never been hospitalized (except for three deliveries) or had a surgery....that is, until this year when I developed an extremely painful ear infection that freakishly spread into my jaw and led to two nights in the hospital. Total bill? $15-20K. When I met with the ENT, he said, "Hey, you had a pretty good run there", implying that at some point we all require care of some sort. You can't eat your way out of a random medical problem. You can't exercise yourself out of an appendicitis. Shit happens, and that's why we have to all be insured.

Also that your family has longevity means that you will likely spend more on your health care than someone who dies young.

[Gin1984]

Even employer-provided health care is a rip-off. I'm only responsible for paying 50% of my wife's premium (and 0% of mine), but even that is $280/month. That's $280/month for half of one person's premium -- and that's for a young, healthy person!

It depends on where you work, and what kind of plan you have. I pay $10/month for my insurance through Blue Cross Blue Shield.

And how much does your employer pay for you?

[beltim]

Ok, so I don't like how the cost of my premium continues to rise while the amount of health care I use goes down. So I want a catastrophic policy to simply cover my assets in case something horrible happens. I don't want the hospital putting a lien on my house. But I can't do that anymore because it is now mandated that I subscribe to a premium with an insurance company which DOES raise the cost of my health care because my insurance premium is part of my health care. ACA made things worse.

Just out of curiosity, if you go to ehealthinsurance.com or another similar site, and get a quote for a catastrophic policy (non-ACA compliant), how much would that save you over your ACA-compliant plan?

[Jack]

I don't think many of you realize how expensive health care is.  The average medical costs in the US for a working age person (i.e. not a child and not covered by Medicare) is about $6,125.

So what? If the entire rest of the developed world is any indication, it shouldn't be that expensive!

So the point is that this whole thread is complaining about health insurance costs, and how they don't get enough value out of their policy every year.  This is a fundamental misunderstanding of insurance – if everyone on this thread complained that they spent more on life insurance than they received, there would be widespread mocking.

If you want to complain about health care costs, that's a valid and important concern.  But that's not what anyone here has done.

Even when comparing health insurance to the taxes people elsewhere pay for their socialized medicine (the closest analogy possible), us Americans are still getting ripped off.

[mindaugas]

Just out of curiosity, if you go to ehealthinsurance.com or another similar site, and get a quote for a catastrophic policy (non-ACA compliant), how much would that save you over your ACA-compliant plan?

$1,560/year. $130/month.
I currently have a family of 4 on golden rule @ $430/month with $10k deductible. ACA plan is $560/month for the 2nd to the cheapest with similar coverage. I lose my plan at the end of 2015. I have a hope that as more people subscribe it may lower the cost, but I keep forgetting about subsidies. I don't qualify for any subsidies.

[netskyblue]

Prior to the ACA employer based insurance was where the majority of Americans got health insurance (54%). 35% were insured by the government (medicaid, medicare). Only a small group, about 10%, of people were forced to buy private insurance by themselves.

I'm curious - is this group (100%) people who HAD insurance prior to the ACA?  If so, how many Americans were uninsured?  My husband (43) got health insurance for the first time in his life when the ACA made health insurance mandatory.  Until last month, he had never worked in a job where health insurance was offered.  I.e. worked for small, family-owned businesses.  Even now, employers with up to 50 employees don't have to offer health insurance.   

I would not be surprised if the majority of individuals that did not have employer or government based insurance were uninsured, rather than having purchased private insurance.  I would expect that most of those people who were employed, worked in low-wage jobs, and thus felt they couldn't afford insurance.

[Gin1984]

Prior to the ACA employer based insurance was where the majority of Americans got health insurance (54%). 35% were insured by the government (medicaid, medicare). Only a small group, about 10%, of people were forced to buy private insurance by themselves.

I'm curious - is this group (100%) people who HAD insurance prior to the ACA?  If so, how many Americans were uninsured?  My husband (43) got health insurance for the first time in his life when the ACA made health insurance mandatory.  Until last month, he had never worked in a job where health insurance was offered.  I.e. worked for small, family-owned businesses.  Even now, employers with up to 50 employees don't have to offer health insurance.   

I would not be surprised if the majority of individuals that did not have employer or government based insurance were uninsured, rather than having purchased private insurance. I would expect that most of those people who were employed, worked in low-wage jobs, and thus felt they couldn't afford insurance.

You missed one group, those who could not get private insurance at any cost.  I was one of those, and the ACA is literally a life saver for me.

[r3dt4rget]

Prior to the ACA employer based insurance was where the majority of Americans got health insurance (54%). 35% were insured by the government (medicaid, medicare). Only a small group, about 10%, of people were forced to buy private insurance by themselves.

I'm curious - is this group (100%) people who HAD insurance prior to the ACA?  If so, how many Americans were uninsured?  My husband (43) got health insurance for the first time in his life when the ACA made health insurance mandatory.  Until last month, he had never worked in a job where health insurance was offered.  I.e. worked for small, family-owned businesses.  Even now, employers with up to 50 employees don't have to offer health insurance.   

I would not be surprised if the majority of individuals that did not have employer or government based insurance were uninsured, rather than having purchased private insurance.  I would expect that most of those people who were employed, worked in low-wage jobs, and thus felt they couldn't afford insurance.

Yes that group is people that had insurance prior to the ACA. The stats come from 2013, before mandatory insurance and other major provisions went into effect. In that year, 85% of Americans had insurance. In surveys prior to the ACA, 85% of people responded that they were happy with their healthcare (if they had healthcare of course). The 15% who went uninsured did so for many reasons. It includes people who were offered employer insurance but opted out (many young people). Also those without access to employer insurance that simply chose not to buy it elsewhere. You can't exactly say that 15% of the population couldn't get insurance. Probably a majority of that 15% couldn't get or couldn't afford insurance, but there is a group that just chooses not to have it. Even with mandatory insurance there will be uninsured people each year.

[Bob W]

Insurance is a voluntary product.  When someone takes your money against your will it is considered theft.        Regarding who pays for insurance please don't include government or quasi government entities as private employers.  Schools, healthcare, cities, states, counties, military, government contractors, courts,  prisons, police, tax exempt organizations,  government grant funded organizations, counties, politicians are all receiving medical care paid by tax payers.   In all 80% of insurance is government paid before the ACA.

[RootofGood]

For the working poor, the article seems to ignore the co-pay and deductible support offered on silver plans. A worker making $20,000/year buying insurance on the exchange sees a silver plan with a deductible of perhaps $1000 and co-pays of $5.

Good point. Our family of 5 with a $40,000 income qualifies for what I call a "gold-plated silver" plan because the copays are $5-10 and the deductibles are between $0 and $900 depending on which gold-plated silver plan we pick.  OOP max is also very low.  Annual premiums are around $1000/yr.  Per year, not month. 

I think those worst off under the ACA are the 20-something dudes that pay more for insurance now, the upper part of the middle of the middle class that are young and don't get a big subsidy, and finally, middle age and older adults earning just over 400% of the FPL in a high COL area where 400% of FPL doesn't make you very wealthy. 

Like a 60 year old married couple who both work as janitors in Silicon Valley each earning $32k/yr.  Their $64k AGI is slightly over 400% FPL and therefore they might be on the hook for some very high premiums.  The state exchange says the cheapest plan is $13,600 per year for this hypothetical couple.  OOP max is $12,500, so they could be spending $25k+ on health care.  At a minimum 20%, and up to 40% of their gross salary on healthcare each year seems like a lot. 

[beltim]

Just out of curiosity, if you go to ehealthinsurance.com or another similar site, and get a quote for a catastrophic policy (non-ACA compliant), how much would that save you over your ACA-compliant plan?

$1,560/year. $130/month.
I currently have a family of 4 on golden rule @ $430/month with $10k deductible. ACA plan is $560/month for the 2nd to the cheapest with similar coverage. I lose my plan at the end of 2015. I have a hope that as more people subscribe it may lower the cost, but I keep forgetting about subsidies. I don't qualify for any subsidies.

Thanks for the data. So about 30% more, which is pretty similar to what I've seen. $35 per month per person seems reasonable to guarantee coverage for everyone, considering how many people were previously uninsurable. Well, it seems reasonable to me at least.

[StashDaddy]

In MMM's case, it looks like his premiums doubled when shifting to Obamacare:  http://www.mrmoneymustache.com/2013/10/28/obamacare-friend-of-the-entrepreneur-and-early-retiree/

[projekt]

In MMM's case, it looks like his premiums doubled when shifting to Obamacare:  http://www.mrmoneymustache.com/2013/10/28/obamacare-friend-of-the-entrepreneur-and-early-retiree/

Yes, and the increased cost reflects an increased quality of insurance. Before ACA, if MMM got cancer in November, he'd have to work pretty quick to get as much diagnostics, surgery, radiation, chemo, etc, as he could before January 1 when his insurance dropped him and he became uninsurable.

[Public Hermit]

Even employer-provided health care is a rip-off. I'm only responsible for paying 50% of my wife's premium (and 0% of mine), but even that is $280/month. That's $280/month for half of one person's premium -- and that's for a young, healthy person!

No kidding. I pay about $250 a month and I am a healthy & single 25 year old male. And I still have a $2000 deductible.

[mindaugas]

Just out of curiosity, if you go to ehealthinsurance.com or another similar site, and get a quote for a catastrophic policy (non-ACA compliant), how much would that save you over your ACA-compliant plan?

$1,560/year. $130/month.
I currently have a family of 4 on golden rule @ $430/month with $10k deductible. ACA plan is $560/month for the 2nd to the cheapest with similar coverage. I lose my plan at the end of 2015. I have a hope that as more people subscribe it may lower the cost, but I keep forgetting about subsidies. I don't qualify for any subsidies.

Thanks for the data. So about 30% more, which is pretty similar to what I've seen. $35 per month per person seems reasonable to guarantee coverage for everyone, considering how many people were previously uninsurable. Well, it seems reasonable to me at least.

Would you like my address so you can cover that extra 30% for me? You understand I wouldn't have to pay this if I could stick with my MMM recommended high deductible insurance plan that ACA now takes away from me right? That $160 is that much less I have to achieve FI and that much more I have to account for going forward.

[Clever Name]

Why are everyone's premiums so high? I have employer-provided insurance for which I pay about $100/month (which is 50% of the total premium), but if I bought a plan from the ACA marketplace I could get a bronze plan for $200/month, a silver plan for $240/month, a gold plan for $270/month, or a platinum plan for $300/month.

I am genuinely curious as to why so many people here have to pay so much more. I do not qualify for any subsidies. Is it just age? I am pretty young (24) but I thought the ACA put a cap on premium differences due to age for a given plan or something like that.

[beltim]

Would you like my address so you can cover that extra 30% for me? You understand I wouldn't have to pay this if I could stick with my MMM recommended high deductible insurance plan that ACA now takes away from me right? That $160 is that much less I have to achieve FI and that much more I have to account for going forward.

I'm happy to pay my extra $32.50 per month to guarantee that my insurance will be there next year, and that the previously uninsurable are able to get health insurance.  I value guaranteed access to health insurance well above $32.50 a month.  It saddens me that so many people don't.

[beltim]

Why are everyone's premiums so high? I have employer-provided insurance for which I pay about $100/month (which is 50% of the total premium), but if I bought a plan from the ACA marketplace I could get a bronze plan for $200/month, a silver plan for $240/month, a gold plan for $270/month, or a platinum plan for $300/month.

I am genuinely curious as to why so many people here have to pay so much more. I do not qualify for any subsidies. Is it just age? I am pretty young (24) but I thought the ACA put a cap on premium differences due to age for a given plan or something like that.

The max allowable difference in premiums because of age is 3x - so the oldest member can pay up to three times as much as the youngest.  Plus, there are huge differences geographically - for my age, I've seen threefold differences in health insurance costs in different states.  And lastly, some people are posting individual premiums and other are posting premiums for their whole family. 

[Gin1984]

Just out of curiosity, if you go to ehealthinsurance.com or another similar site, and get a quote for a catastrophic policy (non-ACA compliant), how much would that save you over your ACA-compliant plan?

$1,560/year. $130/month.
I currently have a family of 4 on golden rule @ $430/month with $10k deductible. ACA plan is $560/month for the 2nd to the cheapest with similar coverage. I lose my plan at the end of 2015. I have a hope that as more people subscribe it may lower the cost, but I keep forgetting about subsidies. I don't qualify for any subsidies.

Thanks for the data. So about 30% more, which is pretty similar to what I've seen. $35 per month per person seems reasonable to guarantee coverage for everyone, considering how many people were previously uninsurable. Well, it seems reasonable to me at least.

Would you like my address so you can cover that extra 30% for me? You understand I wouldn't have to pay this if I could stick with my MMM recommended high deductible insurance plan that ACA now takes away from me right? That $160 is that much less I have to achieve FI and that much more I have to account for going forward.

Would you like to cover, out of pocket, for all of those who don't have insurance yet use ERs?  Because we do, which increases costs as well.  Yes, this is a time where this is in flux but if you thought you could get through your life without tax laws changing, you are crazy. Obviously you need to account for a minor change in costs and yes, $160 is minor when you account for people who could not get health insurance and died or ended up the ER, or both because the lack.

[rocksinmyhead]

For the working poor, the article seems to ignore the co-pay and deductible support offered on silver plans. A worker making $20,000/year buying insurance on the exchange sees a silver plan with a deductible of perhaps $1000 and co-pays of $5.

Good point. Our family of 5 with a $40,000 income qualifies for what I call a "gold-plated silver" plan because the copays are $5-10 and the deductibles are between $0 and $900 depending on which gold-plated silver plan we pick.  OOP max is also very low.  Annual premiums are around $1000/yr.  Per year, not month. 

I think those worst off under the ACA are the 20-something dudes that pay more for insurance now, the upper part of the middle of the middle class that are young and don't get a big subsidy, and finally, middle age and older adults earning just over 400% of the FPL in a high COL area where 400% of FPL doesn't make you very wealthy. 

Like a 60 year old married couple who both work as janitors in Silicon Valley each earning $32k/yr.  Their $64k AGI is slightly over 400% FPL and therefore they might be on the hook for some very high premiums.  The state exchange says the cheapest plan is $13,600 per year for this hypothetical couple.  OOP max is $12,500, so they could be spending $25k+ on health care.  At a minimum 20%, and up to 40% of their gross salary on healthcare each year seems like a lot.

Very good point. It seems to me like it's overall an improvement for many people, but definitely sucks for people in certain situations, which I think you defined pretty well.

I also don't get why people keep saying "high deductible plans aren't allowed under the ACA." In fact my employer is offering an HDHP for the first time in 2015. Do these people just mean "high deductible plans that don't cover preventative care aren't allowed under the ACA"? It seems to me like covering preventative care, and thus encouraging rather than discouraging people to get yearly checkups, would likely lower overall national healthcare costs in the long run since you might catch something early when it's easier to fix. Am I nuts?

[Gin1984]

For the working poor, the article seems to ignore the co-pay and deductible support offered on silver plans. A worker making $20,000/year buying insurance on the exchange sees a silver plan with a deductible of perhaps $1000 and co-pays of $5.

Good point. Our family of 5 with a $40,000 income qualifies for what I call a "gold-plated silver" plan because the copays are $5-10 and the deductibles are between $0 and $900 depending on which gold-plated silver plan we pick.  OOP max is also very low.  Annual premiums are around $1000/yr.  Per year, not month. 

I think those worst off under the ACA are the 20-something dudes that pay more for insurance now, the upper part of the middle of the middle class that are young and don't get a big subsidy, and finally, middle age and older adults earning just over 400% of the FPL in a high COL area where 400% of FPL doesn't make you very wealthy. 

Like a 60 year old married couple who both work as janitors in Silicon Valley each earning $32k/yr.  Their $64k AGI is slightly over 400% FPL and therefore they might be on the hook for some very high premiums.  The state exchange says the cheapest plan is $13,600 per year for this hypothetical couple.  OOP max is $12,500, so they could be spending $25k+ on health care.  At a minimum 20%, and up to 40% of their gross salary on healthcare each year seems like a lot.

Very good point. It seems to me like it's overall an improvement for many people, but definitely sucks for people in certain situations, which I think you defined pretty well.

I also don't get why people keep saying "high deductible plans aren't allowed under the ACA." In fact my employer is offering an HDHP for the first time in 2015. Do these people just mean "high deductible plans that don't cover preventative care aren't allowed under the ACA"? It seems to me like covering preventative care, and thus encouraging rather than discouraging people to get yearly checkups, would likely lower overall national healthcare costs in the long run since you might catch something early when it's easier to fix. Am I nuts?

No, well at least not on this.  : P

[r3dt4rget]

Just out of curiosity, if you go to ehealthinsurance.com or another similar site, and get a quote for a catastrophic policy (non-ACA compliant), how much would that save you over your ACA-compliant plan?

$1,560/year. $130/month.
I currently have a family of 4 on golden rule @ $430/month with $10k deductible. ACA plan is $560/month for the 2nd to the cheapest with similar coverage. I lose my plan at the end of 2015. I have a hope that as more people subscribe it may lower the cost, but I keep forgetting about subsidies. I don't qualify for any subsidies.

Thanks for the data. So about 30% more, which is pretty similar to what I've seen. $35 per month per person seems reasonable to guarantee coverage for everyone, considering how many people were previously uninsurable. Well, it seems reasonable to me at least.

Would you like my address so you can cover that extra 30% for me? You understand I wouldn't have to pay this if I could stick with my MMM recommended high deductible insurance plan that ACA now takes away from me right? That $160 is that much less I have to achieve FI and that much more I have to account for going forward.

Would you like to cover, out of pocket, for all of those who don't have insurance yet use ERs?  Because we do, which increases costs as well.  Yes, this is a time where this is in flux but if you thought you could get through your life without tax laws changing, you are crazy. Obviously you need to account for a minor change in costs and yes, $160 is minor when you account for people who could not get health insurance and died or ended up the ER, or both because the lack.

ER visits represent less than 5% of all healthcare costs. Not enough to significantly effect healthcare costs. The idea that keeping everyone insured would lower ER visits and thus lower healthcare costs was simply a selling point to the law.

[BlueMR2]

Wowza, here's some updated ACA numbers and effects.  Last year our (company provided) insurance jumped 28% due to ACA related increases, which they were able to cover.  This year it's jumping another 34% for the same reason.  It's now so high that the company can't afford to pay the increases anymore.  We're having to pay more into it ourselves and have had our benefits cut as well.  Up until now, the ACA had no visible impact on me.  Now it's impact is that I pay more for less effective insurance.

Really, arguments about ACA itself aside, we as a nation seriously need to find a way to cut healthcare costs.  The whole system is out of whack.  GP pay is too low, specialist pay is too high.  Lawsuit payouts are high, which drives the insurance costs high.  Expensive tests are way overprescribed to try and avoid lawsuits, so insurance companies fight back with armies of lawyers they have to pay for try to avoid paying out.  The inefficiencies are making the system unworkable at scale.

[dandarc]

"You can call it single payer or Canadian-way, only Socialized medicine will ever save the day!" - Jay Billington Bullworth - 1996

[rocksinmyhead]

Wowza, here's some updated ACA numbers and effects.  Last year our (company provided) insurance jumped 28% due to ACA related increases, which they were able to cover.  This year it's jumping another 34% for the same reason.  It's now so high that the company can't afford to pay the increases anymore.  We're having to pay more into it ourselves and have had our benefits cut as well.  Up until now, the ACA had no visible impact on me.  Now it's impact is that I pay more for less effective insurance.

I mean, I keep hearing anecdotes over and over again, and all I can gain from those are "for some people it sucks, for some people it's awesome, for some people it's neutral." For me in my current situation it's been neutral--my contribution to employer-provided healthcare has increased negligibly (I don't know if or how much my employer's contribution has increased), and my benefits have stayed the same. By themselves, these anecdotes are pretty meaningless. I would love to see some actual data, so if anyone has some, feel free to post.

Really, arguments about ACA itself aside, we as a nation seriously need to find a way to cut healthcare costs.  The whole system is out of whack.  GP pay is too low, specialist pay is too high.  Lawsuit payouts are high, which drives the insurance costs high.  Expensive tests are way overprescribed to try and avoid lawsuits, so insurance companies fight back with armies of lawyers they have to pay for try to avoid paying out.  The inefficiencies are making the system unworkable at scale.

Could not agree more!!!

[MustachianAccountant]

Insurance is a voluntary product.  When someone takes your money against your will it is considered theft.

What state do you live in that doesn't require car owners to have car insurance? Remind me not to drive through there.

[dmn]

From my European perspective, the complaints about the ACA seem surreal.

Meaningful health insurance is only possible if insurance companies are required to also offer insure to people with serious (and pre-existing) conditions. That means everybody pays more - because healthy people subsidize those who actually get seriously ill - but everybody knows for sure that he *will* be treated if he should develop a serious disease.

If such insurance is voluntary, then none of the healthy people would buy insurance (cheaper to pay for yourself and get insured if you ever get ill longer-term), and the premiums would be sky-high, making insurance unaffordable for everyone but the rich. Making it mandatory means that everyone shares the premiums while they are healthy, but no one has to fear being dropped by his insurance company when one needs them most.

Note that within such a system, you can still have market forces. I like the Swiss system: by allowing insurance companies to compete, the ones with more cost-efficient structures can offer lower premiums; other companies might offer more than minimal coverage and charge higher premiums. But they must all compete under the same rules: insurance companies must insure any applicants, even with pre-existing conditions, and every applicant pays the same premiums, regardless of their health or age. Insurance premiums in this system are affordable at around 250$/350$ per month (for 2500$/300$ annual deductible), and it prevents situations like "medical bankruptcies" or uninsured chronically ill people, which to most Europeans sound like some kind of post-apocalyptic failed state setting.

[Clever Name]

From my European perspective, the complaints about the ACA seem surreal.

Meaningful health insurance is only possible if insurance companies are required to also offer insure to people with serious (and pre-existing) conditions. That means everybody pays more - because healthy people subsidize those who actually get seriously ill - but everybody knows for sure that he *will* be treated if he should develop a serious disease.

If such insurance is voluntary, then none of the healthy people would buy insurance (cheaper to pay for yourself and get insured if you ever get ill longer-term), and the premiums would be sky-high, making insurance unaffordable for everyone but the rich. Making it mandatory means that everyone shares the premiums while they are healthy, but no one has to fear being dropped by his insurance company when one needs them most.

Note that within such a system, you can still have market forces. I like the Swiss system: by allowing insurance companies to compete, the ones with more cost-efficient structures can offer lower premiums; other companies might offer more than minimal coverage and charge higher premiums. But they must all compete under the same rules: insurance companies must insure any applicants, even with pre-existing conditions, and every applicant pays the same premiums, regardless of their health or age. Insurance premiums in this system are affordable at around 250$/350$ per month (for 2500$/300$ annual deductible), and it prevents situations like "medical bankruptcies" or uninsured chronically ill people, which to most Europeans sound like some kind of post-apocalyptic failed state setting.

From my American perspective it seems surreal as well. I also don't understand why it's still (or ever was) illegal for insurance companies to compete across state lines.