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Woman's health insurance costs $900 a month

A 60-year-old reader asks what her alternatives are.

By MSN Money Partner Jan 29, 2013 4:15PM

This post comes from Stacy Johnson at partner site Money Talks News.

 

Money Talks News logoHere's a recent reader question I could relate to. If you pay for your health insurance, you probably will too.

 

Insurance Money © Comstock Images, Jupiterimages"I need some direction as to where to look for health insurance. I am 60 years old, on workers' compensation with one child still under the age of 26. Of course, I have some pre-existing conditions. Who doesn't at 60 years old? My current insurance just raised my monthly payment $234 per month to a whooping $872, and dental of $120 quarterly, which will bring my payments to over $900. Where do they think people are going to get this kind of money?" -- Elaine

 

I feel your pain, Elaine. I'm 57, and this month my $5,000 deductible health insurance policy just went up an additional 15%. I'm now paying $800 monthly for insurance for what amounts to catastrophic coverage.

 

This is ridiculous, and it's one reason I was a supporter of the Patient Protection and Affordable Care Act, also known as Obamacare.

 

Don't get me wrong: This new health care law has plenty of problems. But I hope it will ultimately address the disgraceful cost of health care in this country. It was certainly about time somebody tried something. The idea behind the Affordable Care Act is to get more people paying into the insurance system to spread the risk and reduce overall costs, as well as to increase competition. Only time will tell if it will work.

 

In the meantime, here are some suggestions to address the cost of your health insurance:

 

1. Shop

Back in 2007, I was researching a TV news story about health insurance and needed video of an online health insurance quote. So I went to a comparison site, input my personal information, and got a quote from my current company. The cost was $346.50 a month. The problem? I had been with this company for seven years, and thanks to annual increases, they were charging me $743 a month for the same policy.

 

As you might imagine, I wasn't a happy camper. When I called the company and asked how they could justify charging new customers half of what I was paying for the same coverage, they mumbled something about premiums increasing over time. So I promptly switched to identical coverage at a different company for half the price. Of course, I avoided the cardinal sin in insurance -- canceling existing coverage prior to new coverage being in place.

 

The single best place to shop for health insurance is this page of HealthCare.gov, where you can find the various carriers, options and prices in your state.

 

2. Understand what you're paying for

While insurance isn't rocket science, it involves unique terms and odd language that can make it confusing. Before you start comparing policies, learn what to look for. For more help, see the link below on shopping for health insurance.

 

3. Pare down your coverage

I don't have a dental plan because I don't think they're worth the money. The maximum benefit of most policies has changed little over the years, even as costs have increased. Result? You're paying too much and getting too little. These policies can cost $50 monthly for an annual benefit that's capped at as little as $1,000. They often pay only 50% of the cost of restorative care and oral surgery, and nothing for cosmetic care. So unless Elaine knows in advance that she's going to need covered dental work, dental is an expense I'd reconsider.

 

After comparison shopping, the second best way to save on health insurance, as well as most other types of insurance, is to raise the deductible -- the amount you pay before the insurance company begins to pick up the tab. As I mentioned, my policy has a $5,000 deductible, which means I pay the first $5,000 of medical expenses annually.

 

Since I've never (knock on wood) spent close to $5,000 in any given year on medical expenses, this means I'm paying close to $10,000 annually for nothing -- except, that is, the peace of mind that comes from knowing that should disaster strike, I won't go bankrupt.

 

Is this ideal? Hardly, especially when insurance company executives are raking in the dough. But this is the world we live in -- a world I hope will change as the Affordable Care Act kicks in.

 

Whether a high-deductible policy makes sense depends on the person. I rarely go to the doctor; Elaine may need regular medical care she can't afford to pay for herself.

4. Go without insurance

This is not an option I'd recommend to anyone. But if you can't afford insurance and you're without savings and/or income, you do have alternatives to the emergency room.

 

There are more than 8,000 federally qualified health centers nationwide. These are medical facilities that charge what you can afford to pay, which includes zero if you're earning zero.

 

According to this page of the Health Resources and Services Administration's website, here's what these health centers can do:

  • Checkups when you're well.
  • Treatment when you're sick.
  • Complete care when you're pregnant.
  • Immunizations and checkups for your children.
  • Dental care and prescription drugs for your family.
  • Mental health and substance abuse care if you need it.

To find one near you, go to the HRSA search page and type in your address.

 

5. Wait for Obamacare to kick in

While some parts of the Affordable Care Act have already been implemented, two of the biggest provisions won't start until 2014:

  • State insurance exchanges that are supposed to drive down prices through increased competition.
  • Government subsidies to help more people afford insurance.

If your income is at or below 133% of the federal poverty level, you'll be eligible for Medicaid. (You can see what the federal poverty level is here on the Famileis USA website. While it depends on the number of people in the household, for the 2012-2013 fiscal year it's $11,170 for a single person.) You may also be eligible with a higher income, depending on state rules.

 

If your income is more than 133% of the poverty level, but less than 400%, you'll get help with insurance purchased through an exchange (in other words, not through an employer). To see what assistance you might qualify for, use this handy calculator from the Kaiser Family Foundation. I put in some made-up numbers for Elaine to see what it would look like. I said she was single and will earn $30,000 in 2014. Here are the results:

  • Income -- $30,000. This is 261% of the poverty level.
  • Unsubsidized annual health insurance premium -- $10,172. This is an estimate of what she'd be likely to pay in 2014 if there were no subsidy.
  • Maximum % of income required if eligible for a subsidy -- 8.36%.
  • Required annual premium payment -- $2,509, which is 8.36% of income, covering 25% of the overall premium.
  • Government tax credit -- $7,663 ($10,172 minus $2,509).

To boil all that down, people making less than 400% of the federal poverty level won't pay more than a certain percentage of their income for health insurance. In Elaine's hypothetical case in the example above, that's 8.36%. Because of tax credits, her insurance expense will drop from about $800 monthly to $200.

 

Now you can see why it's called the Affordable Care Act.

 

More from Money Talks News and MSN Money

18Comments
Jan 30, 2013 5:14PM
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Greetings,
     You have to vote for it to see what's in it.
                   Have a nice day.
Jan 31, 2013 10:23PM
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If congress and ALL government bureaucrats/employees had to participate in the same care as the rest of us,it wouldn't be this way.The US has been cast into the 3rd world,and under this plan,we also will now pay for the rest of the world. ie; "Let's just pass it and we'll see what's in it."
Jan 30, 2013 6:40AM
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Has any one else heard of major employers that are going to drop all coverage because the penalty for not offering insurance is only $700.00 per year?  We are not at 400% of poverty level so it will be about 50% of our income to buy insurance next year if this happens.
Jan 30, 2013 8:29PM
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"Don't get me wrong: This new health care law has plenty of problems. But I hope it will ultimately address the disgraceful cost of health care .."

As the old adage states: "hope in one hand and s**t in the other and see which fills up first"

 

Apr 8, 2013 3:04PM
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Woman's health insurance costs $900 a month- MSN Money : Try this site where you can comapre quotes from different companies:  usainsurancequotes.net
Jan 30, 2013 11:31AM
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After being laid off a job a few years ago I couldn`t get health insurance because of a

minor back problem.It`s called a pre-existing condition.Now, I can because some

of Obamacare has kicked in.Wouldn`t it be nice if the far right told the truth about

Obamacare ?

Feb 1, 2013 6:32PM
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Oh, yeah and don't worry we will just print the money to cover the other $600. per month to cover the shortfall. Maybe we could raise the taxes on your very rich millionaire neighbor who makes $75,000. per year (Not quite a billionaire yet) . Becuase all the real billionaires, all 500 of them have left the USA with their money because it was so depressing living in a country where everybody is broke from the ridicously high taxes that Obama Care created over the years, plus it is so depressing living in a country where the dollars are worth nothing and everyone is so poor.  This is what we are calling affordable health care, taxpayer funded health care for everyone. What's another couple trillion?.  
Feb 2, 2013 11:30AM
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Darn it.  The Clinton Administration got rid of pre existing.  Every administration after that has not changed it.  If some insurance company denied you for pre existing they should be sued.  It's been federal law since 1994.
Feb 2, 2013 11:27AM
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I posted about large companies planning to cancel insurance.  Employers with over 45 thousand employees. What is their penalty?
Feb 4, 2013 6:14PM
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She doesnt realize that at age 60.....ObamaCare figures she has "already lived a long life" and her "quality of life" is diiminished ...........THEREFORE .....ALOT of expensive treatments she may need will be DENIED by the "death panels" ...........a panel of people who are NOT EVEN DOCTORS who will be deciding IF she is WORTHY of being kept around or not .....basically ........ so YES, for you Obama Care lovers.........IF THEY SAY NO TO A TREATMENT .........SHE COULD DIE ..........i.e. the terminology "death panels".

 

The BEST treatment will go to the younger people and the illegals ........you know........those who likely voted "Obama" ...........


What GOOD is "Free" or even REDUCED health care insurance IF ......when you need it ..........THEY ARE GOING TO SAY "NO" ???????  AND ......you are FORCED to PAY FOR IT ??????    People need to be RETHINKING ObamaCare...........IF SOMETHING SOUNDS TOO GOOD TO BE TRUE ..........IT USUALLY .........IS ........

Feb 4, 2013 6:00PM
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For the most part......those who are low income ALREADY get help or "free" insurance if they are eligible ........IF YOU ARENT ALREADY ELIGIBLE..........you STILL MOST LIKELY WONT BE .........with ObamaCare either to get ANY type of assistance.......there won't be too much "change" .........but.......you can still "hope" :)

ObamaCare isn't to help those who DONT HAVE insurance GET INSURANCE .....it is to PUNISH THOSE WHO DO HAVE INSURANCE that is BETTER than someone else's who DOESNT OR WONT PAY for theirs .........IT IS AN EFFORT TO MAKE EVERYONE "EQUAL" . Just because someone ELSE chooses not to pay for insurance, or has crappy insurance......Obama wants EVERYONE else who DOES PAY DEARLY for their insurance ......TO NOT HAVE IT EITHER , to make things "fair" .

People need to understand that in this world there WILL ALWAYS be someone who has MORE than someone else........and ALWAYS someone who has LESS than someone else ...... it will NEVER be truly "equal" across the board EVER ...... it just doesn't work that way .........

I am not rich by far and disabled too........I get NO government assistance of ANY type........and I pay ALL my own bills and for my health insurance as well as part of retirement where I WORKED ........ Why should I , or anyone like me .be PUNISHED cause of that ? I thought the IDEA was to have EVERYONE covered ???? IF THE GOVERNMENT ISNT PAYING for my coverage......why mess with ME ? It makes NO SENSE ........

I can PROVE this to you , that the goal is JUST to make everyone "equal" ........Notice how Obama wants to TAX what he considers to be "cadillac" health care plans ...........PEOPLE ARE PAYING FOR THEM OR BUSINESSES ARE PAYING FOR THEM .......NOT THE GOVERNMENT ........WHY would you want to TAX someone's health care plan JUST BECAUSE you think its "too good" ?????? Don't you WANT people to have "good" health care plans ???? See........you cannot say one thing..........THEN DO THINGS AGAINST.........what you CLAIM to be "the goal" ?

Obama wants HIS HANDS ON YOUR HEALTH CARE ........PERIOD ........so did Hitler .......This is a very scary thing when the GOVERNMENT wants to control YOUR health care people..........UNDERSTAND THIS !!!! It is proposed to be a "good thing".......BUT ITS NOT GOOD.......NOTHING ABOUT IT .......IS TRULY "GOOD".......Just on the surface.........

Those "exchanges" arent private insurance plans......they are ALL GOVERNMENT OWNED AND OPERATED under private type names ..........they basically bully the companies to either GO ALONG with ObamaCare......or they over regulate and put additional burdens on them UNTIL THEY ARE FORCED OUT OF BUSINESS..........SO WHAT YOU HAVE is a SINGLE PAYER system.....they just arent CALLING IT ONE !!!

It will eventually fail .........but sadly, alot of people will SUFFER until that happens and our health care system will totally be RUINED by the time its all said and done ..........BEWARE OBAMACARE FOLKS !!!!


I know many NEED the insurance.......but ObamaCare IS NOT .........THE WAY.........

Feb 4, 2013 5:59PM
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Perhaps this lady needs to read other recent MSN articles stating the CHEAPEST ObamaCare plan for a family will be $20,000 or MORE ????? THEN ...when she needs something "too expensive" done , which will be decided by a panel that are not even doctors........i.e. "the death panels"......she will be told "NO".

The numbers I have seen so far show that ObamaCare will cost AS MUCH IF NOT MORE than other insurance policies out there ALREADY ......there are ALSO several tiers to the coverage.........what happens when EVERYONE chooses the LOWEST tier cause its all they can afford........and the deductibles and copayments ect are STILL more than they can afford to pay ????

Currently, there are no "debtor prisons" in the US.......however, the IRS CAN AND WILL confiscate assets and bank accounts, and IRS refund checks to "satisfy" your debts to them ........People do not realize.......your bank account could be emptied out, your tax refund taken, and even YOUR HOME .........if you fail to pay into this ObamaCare mess or have other insurance !!!! ALSO please be aware that the "poverty limits" for like one person is ONLY like $11,000.........its VERY LOW and most EVERYONE will fall ABOVE that limit to where you will NOT get any type of "assistance" from the government !!! The reason people wanted ObamaCare is because most of them THOUGHT it was going to be "free"..........its not going to be "free" or even AFFORDABLE folks.......and its going to suck when you DO PAY FOR IT ........that is just the FACTS .

ADDITIONALLY, this ladies insurance skyrocketed like it did BECAUSE OF ........OBAMACARE .........and she isn't realizing that ????? The WHOLE idea is to over regulate the insurance companies, add additional coverage they must now provide, ect........so they HAVE TO CHARGE MORE and people will DROP THEM and GO ONTO OBAMACARE ........see the picture now ? ObamaCare will be an EPIC failure because people cannot AFFORD to pay the amounts they will be charging .......and they HAVE to have the money to FUND IT ......even people who CAN AFFORD TO PAY will in alot of cases, chose NOT to do so ..........

 

 

Feb 3, 2013 4:54PM
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The author missed an obvious one. The Healthy Savings Account is a high deductible plan, but if you don't use what you deposit, you can roll it over indefinitely. So the author pays almost $10K a year just in case? They could keep the unused portion if it were simply put into an HSA. This is an option many do not know about but should check into. It sort of changes the insurance deal from me betting that I WILL get sick to me betting that I won't. I switched this year and simply put the amount of the premium I would have paid on the traditional plan into my account. Whatever I don't use, I can keep and I am still protected from catastrophic illness or injury. Read up on it. I don't know the restrictions, but I am liking it, as are many of my co-workers.
Feb 4, 2013 6:16PM
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OBAMACARE isnt about providing insurance to those WITHOUT IT ......it is ALL ABOUT .....TAKING AWAY from those who DO HAVE IT AND PAY FOR IT ..........so everyone is "equal" and we all meet up at the GOVERNMENT CLINIC.......
Oct 24, 2013 1:40AM
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@CharinOhio there is no factual basis to the idea that there are death panels. Medical Insurance companies today make decisions about paying claims according to what the current standard of care is. The government does NOT set the standard of care or decide to approve or deny a claim. An employee of the insurance company decides whether to pay a claim. If anything, the ACA has helped us out by mandating that at least 85% of premiums should be used on claims. As it stands, an insurance company can collect your premium, deny your claims, and distribute your money that you paid in good faith to the CEO as a bonus or to shareholder dividends. It's the easiest money ever made. And if more people understood that maybe they would not be so easily fooled by people trying to scare you with the idea of death panels. The ACA has done a great deal to protect consumers...and to the individual that said pre-existing condition rules were signed by Clinton-that only applies to people that had group health insurance when they were diagnosed and continuously kept group health insurance 
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