MW continues:
But for a healthy 20-something who rarely goes to the doctor and doesn’t take prescription medications, that penalty might be far less expensive than buying a health plan through the state health exchanges, the new insurance marketplaces opening Oct. 1. Those exchanges, which will offer health coverage to people who can’t get it through their employer or by staying on their parents’ insurance, are just beginning to announce how much their plans will cost. But based on the rates released so far, the price of health insurance for a 20-something will start at about $72 a month in Washington, D.C., and $117 a month in California, for minimal coverage known as a “catastrophic plan,” available to people under 30.Bottom line: It makes very little sense for healthy youth under 30 to sign up for health insurance under Obamacare. You really have to be ObamaDumb to do so.
That means that for someone making less than $86,400 in Washington, D.C., or less than $140,400 in California, even the cheapest health insurance would still cost more than the penalty (a 1% penalty on an $80,000 salary, for instance, would be $800, while the lowest-price insurance in Washington would cost $864 a year and in California, $1,404).
72/month is not terribly bad for a 500k policy, especially if you need an appendectomy or some sort of emergency procedure where the hospital could run up the bill on you. You should make sure your auto insurance has a couple hundred thousand on it in case your in an accident. But since they can't deny you coverage because of pre-existing conditions you can just wait until after you get sick and apply the insurance retroactively.
ReplyDeleteWhen people say that our doesn't make sense for healthy young people to sign up for insurance under Obamacare, are they just referring to the state-sponsored exchanges or would it also not make sense for a young healthy person to purchase insurance through their employer if they can? Would not purchasing insurance if they could have a negative impact on their ability to do so down the road?
ReplyDeleteI'm wondering the same. If it's only costing you about $10 a month extra to buy catastrophic insurance versus paying the IRS penalty, that might be worth it.
ReplyDeleteThe problem is, if I recall correctly (or just based on the history of the income tax, which started at 1%), the minimum penalty will be increased in future years. The health insurance lobby will see to that. At which time the price of catastrophic insurance and every other type of health insurance will rise right along with the penalty. In effect the US Fed Gov't has imposed a centrally controlled health care system that operates for the benefit of insurers and health care providers via the ACA, while doing as much as possible to suppress a voluntary market-based system in which providers and insurers compete to meet the demands of patients. The ACA would not have been so easy to impose, had Supreme Court Chief Roberts not decided to call the ACA constitutional under the taxing power; I wonder if he'll live to regret that decision.