Wading through the Obamacare swamp was an interesting experience.
Our application finally went through and we’re in the process of selecting a health insurance plan to enroll in. The Healthcare.gov website is….um, a real piece of work. Yeah.
Supposedly, the whole point of the Affordable Care Act is to bring affordable healthcare to the masses. The insurance companies are allegedly supposed to follow a set of rules where they can’t turn people down for pre-existing conditions, there are limits on how much extra you can charge old and sick people, they have to provide a common set of basic wellness services, deductibles and out-of-pocket maximums are capped, and stuff like that. It all sounds good on paper, but there’s no such thing as a free lunch, and this is reflected in the plan structures and premiums on the exchange.
There was also supposed to be a broad selection of choices and a convenient exchange through which you could price and compare the available plans, which would theoretically foster competition across the various providers and drive costs down. That’s another thing that sounds good on paper, but doesn’t always work out in practice. I’ll get to that in a minute.
The flip side is that if you choose not to sign up for an approved health insurance plan, you will be charged a tax penalty in 2015. This starts out at the greater of $95 USD or 1% of your income, and supposedly ramps up every year. Additionally, you can’t just sign up whenever you feel like it, and instead must apply during a specific enrollment period. Both of those measures are apparently intended to encourage people to get with the program. There are a number of exemptions for factors like hardship. I don’t particularly like these parts of the deal.
After I began the enrollment process, I saw that there were 76 plans on the exchange to choose from. Several of the Bronze plans were more expensive and offered worse features than the lower tier of Silver plans, for example, and some of the Silver plans were more expensive and offered worse features than the lower tier of Gold plans, so all of those got weeded out in short order. A comparison of the plan details and summaries for the remaining options reduced the total candidate pool to 5 plans that didn’t completely suck.
The cheapest option, a Bronze plan, had a deductible of $12,600 USD and a subsidized monthly premium of about $143 USD. You’re totally out of pocket on all costs until you hit the deductible, then the insurance picks up the tab. This kind of plan only makes sense if you already happen to have $12,600 USD sitting in the bank or you have an extra $1,050 USD per month to sock away. Otherwise, you’re basically giving free money to the insurance company and contenting yourself with the knowledge that if you get hit by a bus, you’ll only incur $12,600 USD of crushing debt.
The only reason I’d go for that plan would be to limit our total financial exposure in the face of a medical catastrophe for as small a monthly outlay as we could possibly get away with, which is why I added it to the candidate list. However, I’m not much of a gambler–we already had a scare in 2009 when my wife had ovarian cancer and needed surgery for it, so it’s not really something I’m comfortable rolling the dice on.
The second cheapest option is another Bronze plan. This one has a subsidized monthly premium of about $187 USD, a deductible of $9,700 USD, and an out-of-pocket maximum of $12,700 USD. Unlike the previous plan, there’s a copay structure that kicks in before the deductible is met and a coinsurance structure that kicks in after the deductible. However, again, this kind of plan only really makes sense if you already have $12,700 USD in the bank or an extra $1,080 per month to sock away. There’s a $3,000 USD deductible for prescription drugs, but Level 1 and Level 2 drugs are covered by a copay structure and don’t count towards the deductible. Emergency room and ambulance costs aren’t covered at all until you meet the deductible, and then you’re on the hook for 20% coinsurance.
I’m slightly less hostile towards this plan than the previous one because we don’t have to first meet the high deductible before benefiting from a copay/coinsurance structure, but it’s still not an awesome deal without a $12,600 USD safety net in the bank.
The mid-priced option is a Silver plan. This one has a $9,200 USD deductible, a $12,600 USD out of pocket maximum, and a subsidized monthly premium of $218 USD. There’s a vaguely reasonable sounding copay/coinsurance structure in place, and as with the previous plan, there’s a $3,000 prescription drug deductible. Level 1 and Level 2 drugs are covered by a copay. Emergency room and ambulance costs aren’t covered at all until you meet the deductible, and then you’re on the hook for 20% coinsurance, just like the previous plan.
The only real reason I would favor this plan over the previous Bronze plan, aside from the slightly lower deductible, is that the copays for doctor visits and urgent care are 50% lower and the prescription copays are also lower. Estimating the frequency of visits and prescription refills, I figure we’d actually come out slightly ahead compared to the previous plan. The deductible is still much too high for comfort, however.
The second highest priced plan on my short list is a Gold plan with a $5,000 USD deductible, a $7,000 USD out of pocket maximum, and a subsidized monthly premium of about $308 USD. The prescription drug deductible is $1,000 USD, but as with the previous plan, Level 1 and Level 2 prescription drugs are covered by a copay. The copay structure for doctor visits and urgent care is about the same as the previous Silver plan. Emergency room and ambulance costs aren’t covered at all until you meet the deductible, and then you’re on the hook for 20% coinsurance, just like the plans above.
The deductible and out of pocket maximum are markedly better, but the monthly premium is high enough to make me sweat from a budgeting standpoint. It’s pretty close to the threshold where we wouldn’t really be able to afford to pay the premium and also see the doctor or get a prescription filled, at least not without subsisting on rice and beans for the rest of that month.
The most expensive plan on the list is a Platinum plan with a $0 USD deductible, a $3,000 USD out of pocket maximum, and a subsidized monthly premium of about $464. The prescription drug deductible is $0 USD, with an identical copay structure to the Gold plan above. The copay structure for doctor visits and urgent care is also the same. Emergency room and ambulance costs are covered by a 20% coinsurance. The monthly premium would put us over budget, however, so this plan isn’t really a practical option yet.
It’s pretty likely that we’re going to opt for the Silver or Gold plan on the list, pending a final review of our monthly budget. I really wasn’t thrilled by how quickly the pool of viable choices dwindled from 76 plans to 5 plans, and I’m even less happy with the fact that all 5 of these choices come from the same company (Humana). According to my research, Humana doesn’t seem to have a particularly good reputation with policyholders, but that’s tempered a little by the fact that Concentra is part of their provider network, and we’ve had consistently good experiences with Concentra. As long as we stay out of the emergency room and don’t stray too far from what’s covered by the copay structure, I suppose we’ll be fine.
All of the plans on the exchange stink to a certain extent, but I guess having some insurance is better than having no insurance at all. Actually, I think my biggest objection to the whole thing isn’t so much that the pickings are slim, but is probably the fact that I dislike the feeling of being clumsily railroaded by the government into making a choice between paying for mediocre health insurance or paying a penalty for opting out. That’s what doesn’t sit well with me.
