Insurance Again......The ACA for 2016

It’s time for my annual protest about health insurance.  Two years ago I wrote a more involved post   (http://eldondekay.blogspot.com/2013/07/monday-july-08-2013.html#links ) on the subject, and I’m afraid I’m going to reprise the same subject with updated data, and the open question of, “How can this work?”

In the beginning of the Obamacare era, there were only two companies that offered policies in Alaska: Moda and Blue Cross.  Last year another company offered policies, but notified their subscribers mid-year that they would be leaving the market.  Comparable plans had almost exactly the same premiums so it didn’t seem to matter which we chose.

My only desire was to buy insurance to cover my wife and I in the case of a catastrophic accident or illness, but those sorts of policies are not legal under the ACA.  To get as close to this goal as possible, this past year we chose a policy with the highest deductible available, namely $12,700 for the family.  My premium for that peace of mind was only $20,000 per year. 

Beverly had a kidney stone that had to be surgically removed and along with other medical expenses, for the first time as a couple, we actually met our deductible.  Since we met the deductible, we felt empowered to have a few other things taken care of that we have neglected in the past, but our total medical expenses for the year will probably be at the highest, $20,000. If our claims are that high, the insurance company will have paid roughly $7300 after I have paid $20,000 in premiums and $12,7000 in deductible, or a total of $32,700.  The insurance company will still have taken in $12,700 more than they have paid out on our behalf. Not a bad return if you can get it.

I got my annual premium notice for next year a week or so ago.  It appears that the return is obviously not good enough.  My premium for the same policy will be raised to $30,000 and the deductible raised to $13,700.  I will have to pay out $43,700 in insurance plus deductible before the insurance company pays anything. How can this be tenable?   

The federal government pays subsidies for income levels 100%-400% of the federal poverty level.  All subsidies are phased out at a joint income of $97,000 for next year.  Assuming others are paying similar premiums, that means that a family earning $97,000 per year really only has $67,000 per year on non-medical expenses and will have to pay another $12,700 of their disposable income in health care costs before their insurance is any good to them.

It seems an anticlimax to a life to be in a hurry to reach 65 so that Medicare kicks in and you can afford your health care, or at least pass the expenses off to the next generation.  It’s only fair……