How much will it cost me?
As officials prepare to roll out Vermont's new way of purchasing health insurance for some of us beginning Jan. 1, 2014, the most pressing question on people's minds is, "How much will it cost me?"
All of the information that follows is available on the Vermont Health Connect web site at: healthconnect.vermont.gov. Keep in mind that subsidies (government assistance for the payment of monthly premiums) is based on income and only is available to people who do not have insurance available to them through an employer.
If an employer offers insurance that is deemed affordable and comprehensive enough by the state, that employer still may pay any portion of his employees' premiums he desires and the employer may also be eligible for tax subsidies.
What follows is the result of plugging in different scenarios into the Vermont Health Connect web site calculator. Figures range from premiums for six plans, from Platinum plans to Bronze plans. All of the coverage is the same. The only thing that varies is premiums and out of pocket expenses.
According to the web site, "If you purchase a health plan through Vermont Health Connect, you may qualify for a subsidy, in the form of a tax credit, that will help you pay for part of your monthly premiums starting in 2014. You can choose to apply your subsidy to your monthly premiums or you can get it all at once when you file your federal income taxes. Financial help will also be available for some individuals and families to help pay for out-of-pocket health care costs. If your employer offers health coverage, you will not be eligible for a subsidy because you are already covered. And the plans offered through your employer may be required to follow new regulations that improve your benefits."
Here are some possible scenarios based on using adjusted gross income for individuals and families at the web site calculator. A single person whose income is $30,000 a year is eligible for a subsidy of $241 a month. That means they can choose a low deductible plan for $347 a month (with the subsidy applied) and have no more than $1250 in out of pocket expenses to pay each year.
That same person could choose the lowest premium at $115 a month and take a chance of possibly paying up to $6250 a year in out of pocket expenses. I suspect that none of these options will seem particularly attractive to someone making $30,000 a year. They will have to make some difficult decisions.
A two person family with the same income of $30,000 would receive a monthly subsidy of $685 so their monthly premiums could range from $492 to $7 depending on how much risk they are willing to take.
A family with two adults and two children with an income of $45,000 would receive a monthly subsidy of $995 and their monthly premiums could range from $658 to $7, again depending on how much risk they are willing to take.
A two person family with a $60,000 income would receive a $322 monthly subsidy and their monthly premium could range from $855 to $391, with the same range of out of pocket costs as above.
A family of four with the same $60,000 income would receive a monthly subsidy of $827 and their monthly premium could range from $827 to $175, again with the same out of pocket risk range. A family of four with an income of $80,000 receives a $527 monthly subsidy with a possible monthly premium range of $955 to $303, with the same range of out of pocket options.
It is possible that some lower income people may receive further subsidies to help pay for some of their out of pocket costs. The coverage for everyone will be excellent.
The big question for most people will be whether or not they can afford to buy this new insurance. How will it compare to what they have now? Keep in mind, this whole scheme was forced upon the states by the federal government under the so-called "Affordable Care Act of 2010."
It is a free market approach to lowering health care costs. Because Vermont had already been ahead of the rest of the country in this area, many of our citizens will be forced into a temporary insurance market that will hardly look like progress.
Richard Davis is a registered nurse and long-time health care advocate. He writes from Guilford and welcomes comments at firstname.lastname@example.org.
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