The Robards are a typical middle-income couple. At sixty-three, we have worked our whole lives, saved some, but not enough, and planned the best we can for our future. Our children are grown with children of their own. The fifteen-year mortgage should be paid off in three years and nine months. I am a pastor, and my wife is an Advanced Registered Nurse Practitioner.
Recently, we realized that Debby could not continue at the pace demanded by her full-time job. We spent much of our savings to get out of debt, so that she might semi-retire, and work only a couple days a week. Our only concern about this plan was health insurance. Working part time meant that we would have to purchase a plan that would carry us until we are sixty-five and eligible for Medicare.
I asked some qualified men, on our budget committee at church, to research options for me. My own research suggested that a high deductible health plan (HDHP), coupled with a health savings account (HSA), was our most logical option, since we are both in good health. We needed a PPO to keep our present doctors. I was floored when I saw what they found.
There are many reasons why healthcare has become so expensive for Americans, but my question is, “Should healthcare cost more than a couple’s house?” For years people have said that a person’s home is the biggest investment they will make in a lifetime, but now it seems that healthcare has taken center stage. Based upon our income, we do not qualify for any subsidies, even though our income will decrease significantly this year. The least expensive plan on the exchange, that met our needs, was like having no insurance at all, until we reached our deductible.
Our cost would be $1,354 per month for the insurance purchased on the Obamacare exchange. My wife and I together would have to pay at least $5200 ($2600 individual) in medical expenses before the policy paid anything. After $5200 in expenses, the premium covered 50% of our medical costs up to an out-of-pocket expense of $12,700. These figures are for in network doctors. For out of network medical care, the deductible rises to $15,600 with a total out-of-pocket of $38,100 per year. True out-of-pocket expenses include monthly premiums. $16,248 in annual premiums + $5,200 deductible means that with this plan we would at pay at least $21,448 before the insurance would pay a penny. Who can afford the Affordable Care Act?
Our dilemma: this insurance was unreasonable and unaffordable. A medical emergency, would still wipe out our savings. Going without insurance, and paying a penalty, also did not set well with me. I feel convicted about not following the law, even when the law is wrong or unfair. Debby and I prayed for God’s help. Such high premiums, and ongoing medical costs would never fit our budget.
Almost immediately I received an e-mail that said we had overpaid on our escrow account and we would be receiving a refund. Our monthly payments on our home should be going down some. Things were looking more hopeful. Later that day we received a letter offering us COBRA insurance (Consolidated Omnibus Budget Reconciliation Act). COBRA insurance came into effect in 1985 when President Ronald Regan signed legislation that allowed individuals, who met certain qualifications, to keep their policy, and pay the full premium for their current health insurance, when they no longer qualify for it through their employer.
What a great blessing in direct answer to our prayers. Our insurance premiums are going to be less than half of what we would be paying on the Obamcare exchange. It covers dental, vision, prescription drugs, and pays a healthy portion of all our medical expenses from the beginning. In every way the COBRA option is reasonable, doable, and meets our insurance needs. We can keep it for up to eighteen months. Debby will be eligible for Medicare and I will have to purchase insurance for just a few months. Thank you Jesus.
Reflect on these figures. Something is terribly wrong. The corporation my wife works for insures numerous employees. They take a certain amount of money out of the employee’s paycheck and supplement it, to provide health insurance. The corporation gets the financial break because of the number of policies written, and provides much better coverage than what one finds on the exchange. I am not sure how it works with lower income families, or no income families, but for the middle-class, working for larger companies, health insurance is a relative bargain.
In our case, the total cost of health insurance, for this family of two, is a little under $600 per month, with reasonable benefits. If government can dictate that we must have insurance, and they offer insurance exchanges, why can’t they also bargain on behalf of the American people with insurance companies for the best deal, same as the private sector? Potentially, the Federal Government represents a much larger clientele than the largest companies in our nation. As it stands, the Affordable Care Act is neither affordable, nor caring of the working class.
Addendum: There is a case where out of pocket expenses would be reduced. If one of us reached the deductible and the other incurred no medical expense the entire year, total out of pocket for the year would reach $19,888 before the insurance would pay 50%. The policy also states that it pays for preventative medicine and wellness services and should provide a 30-40% discount on prescription drugs under certain conditions.