Monday, February 24, 2014

My name is Andy. I'm an an ACA policy-holder.

There is a vocal contingent of people that sees the Affordable Care Act as a train wreck and people like me as dependent on a government hand-out.  So I wanted to air some facts.
  1. If you can I cannot agree on the high-level goals of the first 17 pages (the table of contents) of the Affordable Care Act then we should probably just part ways now.  The goals, to me, seem like things that we should all be able to agree on.  If you agree on the goals but have a better solution then talk about *that*.
  2. My family selected Optima's Vantage Foursight 3500/80% silver level plan. Here are the important terms:
    • $1,140/mo. premium (we'll talk subsidies below)
    • $3,500 deductible per person, $7000 for the family
    • $6,250 maximum out of pocket per person, $12500 for the family
    • $25 co-pay on 4 doctor visits per person per year and 20% co-pay there after
    • $150 drug deductible
    • Tiered drug co-insurance... $15 co-pay/generics and the greater of $30 co-pay/40% co-insurance OR $50/50% depending on the "tier")
    • 20% co-insurance on almost anything else
  3. We forecasted income at $56,000 (as an entrepreneur starting something new and with only intermittent income it may be lower but we wanted to avoid dealing with another set of rules and regulations that we would've qualified for under Medicaid as a family of 5 with 3 kids).  This qualified us for $633/mo. of premium subsidies.
  4. In the worst case (multiple big expenses and non-generic drugs charged at 50% co-pay for multiple family members) assuming we qualify for the subsidy for the whole year (i.e. we don't make more than $56k for the year) we would pay: $18,584 total for the year.
  5. If we ceased to qualify for the subsidy that total increases to $26,180
Undoubtedly you will look at those numbers and think "$%@*% that is really expensive!  The median US income in 2013 was $51,000.  How is nearly 50% of your income AFFORDABLE health care?"  consider few more things:
  1. This is the worst case.  Best case where we had no medical expenses at all would be $6,084/$13,680 (with and without subsidy)
  2. There are actually two types of subsidies/tax credits; premium subsidies and cost-sharing subsidies.  I have not investigated the cost-sharing subsidies which could limit my out of pocket expenses beyond premiums.
  3. Take a minute and review my pre-ACA analysis of Anthem Health Insurance plans.  The best and worst case of the common "Anthem Premiere" plan is within 10-15% of the ACA plan above.  So it's not as if the existing options for my family were hands down better before the ACA.
  4. The point of insurance is to hedge against costs that are financially ruining.  The worst case under this policy would not be financially ruining to almost anyone.  On the other hand the cost of even "routine" hospital visits can quickly rack-up bills that are ruinous much less things that are not "routine."
  5. ACA-compliant policies have broader coverage, no pre-existing condition exclusions, and no lifetime limits.
Yeah, but is it really worth it?  Let me leave you with a few more facts.
  • We use a couple of drugs that don't have effect generic equivalents that cost almost $500/mo each.  That alone could add up to near $12,000 (you don't get a "cash" discount from pharmacies and even Canadian online pharmacies were only 10-20% cheaper).
  • We had several "routine" procedures that used hospital or other special facilities, anesthesia, etc.  The total of those was around $20,000.
You do the math.

1 comment:

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