In a comment on resurgent talk of “sticker shock” for premiums on insurance bought through the Obamacare exchanges, Kevin Drum makes two points that are important to keep in mind. The first is that the number of people likely to see a major increase in net insurance costs—in excess of the subsidies they may qualify for—is not as large as you might think:
This probably doesn’t describe a huge demographic—people who are just barely above the subsidy threshold and currently have individual coverage and are young enough to see premium increases—but there’s no question they exist.
Those who do fit into this relatively narrow band of people will typically get better coverage for their additional dollars, but they may not appreciate it just yet. Kevin points to a woman quoted in an L.A. Times article on “sticker shock” as illustrative:
“Fullerton resident Jennifer Harris thought she had a great deal, paying $98 a month for an individual plan through Health Net Inc. She got a rude surprise this month when the company said it would cancel her policy at the end of this year. Her current plan does not conform with the new federal rules, which require more generous levels of coverage.
“Now Harris, a self-employed lawyer, must shop for replacement insurance. The cheapest plan she has found will cost her $238 a month. She and her husband don’t qualify for federal premium subsidies because they earn too much money, about $80,000 a year combined.
“‘It doesn’t seem right to make the middle class pay so much more in order to give health insurance to everybody else,” said Harris, who is three months pregnant. “This increase is simply not affordable.’”
I don’t know for sure how this plays out in the real world, but I’d be shocked if Harris’s $98 plan covers expenses related to pregnancy. If it does, the out-of-pocket max is probably astronomical. A bronze plan under Obamacare is still no picnic, but I’m willing to bet it covers a whole lot more of Harris’s maternity expenses than her current plan. In other words, there’s a pretty good chance that she’ll make up for her extra annual expense of $1,700 by sometime around, oh, April or so.
And even if she doesn’t, she now has insurance that will protect her from unforeseen medical conditions and out-of-pocket expenses even if they don’t occur. It is sometimes forgotten that every kind of insurance involves the potential of “excessive” premiums if you get lucky and don’t need it.
But more basically, the politics of Obamacare will indeed be affected by the attitudes of people who do or don’t view their enhanced insurance as having value, and do or don’t think they’re just shelling out dollars to “give health insurance to everybody else.”
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