US News: So far, my personal experience with the Affordable Care Act brings one word consistently to mind: Extortion. So when politicians and beltway operatives say things like “Obamacare is the law and people need to accept that,” I’m bitterly disappointed. I’m angry and I know that the person uttering those words has probably never written a personal check for his or her health insurance premiums.
As someone who does pay for her own premiums, I like to think we can do better than suffer the type of extortion that I am experiencing as a self-employed American.
In 2015, my husband and I (both of us are self-employed) will pay $733 each month for our “Bronze” level health insurance plan. Yes, Bronze is the lowest (and the cheapest) of three levels of Affordable-Care-Act-qualified plans.
Our family deductible is $11,000. That’s very high. Here’s a reminder of what a deductible is, courtesy of healthcare.gov:
Deductible: The amount you owe for health care services your health insurance or plan covers before your health insurance or plan begins to pay. For example, if your deductible is $1,000, your plan won’t pay anything until you’ve met your $1,000 deductible for covered health care services subject to the deductible. The deductible may not apply to all services.Before the Affordable Care Act, there was an inverse relationship between deductibles and premiums. If you, as an individual, wanted a low premium (say $100 or $200 a month), you chose a high deductible (usually around $10,000) plan. If you wanted a low deductible (like the enviable $1,000 mentioned on healthcare.gov), you paid more for your premiums.
Now the relationship between premiums and deductibles has changed. Because the health care law requires all health insurance plans to meet unnecessarily high standards — with benefits exceeding what many people want or need — high-deductible plans also come with high monthly premiums. It’s a bitter pill for the self employed in particular because we also do not have the benefit of buying insurance as a group (where economies of scale and risk pools can lead to more reasonable premiums).
In other words, individuals who bought their own insurance used to be able to choose to the Motel 6 of plans; now they have to choose a Hilton.
It’s fairly likely that my husband and I won’t ever meet our $11,000 deductible. We’ll pay the “Hilton” price of $733 each month (that’s $8,796 for the year) to comply with a law that forces us to purchase health insurance, but we’ll also pay out-of-pocket for our health-care costs with the exception of a few basics (i.e. an annual physical).
Not a great deal, right? Not “affordable.” And also not a choice. It’s the law. If we chose to go uninsured and pay out of pocket for doctor’s visits and medication, we’d be in violation of federal law. We’d be forced to pay a fine.
Pay up or become a lawbreaker. It’s a serious threat, which feels a lot like extortion.
I believe in the importance of having insurance, of protecting myself against worst-case-scenarios. It’s why homeowners’ insurance and car insurance make sense. But each of those cost me and my husband less than $1,000 per year.
Health insurance, of course, isn’t like most insurance. We shouldn’t even call it insurance, honestly. It’s more like a payment plan — where we give our hard-earned money to a big company so that they can then pay our very personal health care bills (an inherently creepy system if you think about it).
And that’s what gold level insurance plans do. They have low or no deductibles, so in exchange for a high monthly premium, your big insurance company will pay for all your medical needs. How lovely — especially if someone else (your employer or the government) pays your premiums.
But those of us in bronze? Not so much. Our payments keep Uncle Sam away; they don’t buy us much else.
This is what the Affordable Care Act’s individual mandate feels like to every self-employed person in America. We’re being forced to buy something that is very expensive — so expensive that it may not be in our economic best interest to purchase it. But we have to.
So don’t tell us this law can’t be repealed or significantly improved. The self-employed and small business owners (who employ half the nation’s private sector workforce) need to have hope — hope that someday we will feel something other than forced and fleeced when we buy health insurance.
DCG