A Perfect Fit for Everyone Except Government
Walk down any grocery store aisle, and you’ll notice choice is a hallmark of our culture – the more, the better. Choice is what keeps customers happy and competition alive. It’s what drives the market. However, choice was not an option for Washington-resident Chan who couldn’t keep his affordable, well-liked catastrophic plan.
Retiring in 2008, Chan decided to continue his employer coverage – a “Cadillac” plan – through COBRA, which initially cost he and his wife $949 a month and increased to $986 in 2009. When the COBRA program expired, they opted for a more affordable plan.
“We did some research and found that we could purchase a catastrophic plan for $392 a month. This saved us $7,128 a year in premiums. The policy had a $7,000 deductible and a maximum out of pocket expense of $10,000. We typically spent less than $3,500 in medical bills annually, not counting insurance premiums. We saved a minimum of $3,500 each year by buying this policy, which still protected us financially in case of major medical problems,” explained Chan.
With the passage of Obamacare, the plan that perfectly fit Chan and his wife’s needs started morphing into a policy riddled with government mandates, resulting in higher costs.
“In 2010, Obamacare passed. Our insurance premiums began increasing a minimum of 20% each year since. We were able to reduce the increases to an average of 13% by changing deductibles and co-pay percentages. Every time the increase was based primarily on new government requirements and/or mandated coverage. Both state and federal governments were involved. Even though we won’t use it and don’t want it, we are now covered for such things as birth control, breast-feeding support and supplies, HPV testing, screening for gestational diabetes, counseling for sexually transmitted infections, etc.,” he stated.
In September, they received a cancellation notice as expected, stating catastrophic coverage was no longer being offered to those above the age of 30. Yes, choice was gone, and costly coverage was just beginning.
“The cheapest plan available to us will cost a minimum of $492.93 each. Our monthly premiums will be $985.86 – the same amount that we decided 4 years ago we could not afford. We are at the bubble point for government subsidies,” Chan pointed out.
Wanting to be the sole deciders of how to best use their money, Chan and his wife determined that they – not the government – will choose what is right for them. Their solution, similar to an HSA plan, may benefit them in the long run, especially if more doctors pull out of the insurance market due to Obamacare and become cash only.
“We are both having checkups, and plan to drop our insurance completely if nothing major is found. Rather than pay $1,000 or more a month for government-mandated coverage we do not want or need, we will put a designated amount into a savings account each month for future major medical needs. We will continue to pay our own medical bills, just as we have been.
Obamacare has cost us the insurance we liked and wanted to keep. It has forced me to put a price on my life of whatever is in our medical savings account,” Chan exclaimed.
In a government-knows-best, one-size-fits-all system, this is what choice looks like. It’s a stark contrast from the real marketplace where affordable coverage, preferred doctors and plans, and most importantly choice are available.