Obamacare, the Good, the Bad, and the Wugly

The Good:
“I ventured into the ACA minefield,” my friend Fanny Guay said. “I found I can get ‘gold premium’ coverage for about what I am paying now, thanks to the subsidy.”

Enola “Fanny” Guay’s parents joined the back-to-the-land movement in Vermont at the Nearings old farm house, far from big government and rampant consumerism. Ms. Guay’s friends are now the power brokers and consumers of Montpelier but she just lost her job with a small heating assistance NGO when they lost their outreach contract with the University. I’ve known her for nearly 50 years; she was pro-Cheryl Rivers in Vermont years ago and is pro-Obamacare now.

The Bad:
The real subsidy gotcha comes when Ms. Guay discovers that her subsidy isn’t a guarantee; it is an early refund of an income tax credit. A guarantee on Obamacare that isn’t, well, guaranteed? Imagine that.

Ms. Guay hopes to find a new job next year but says, “I figured the cost on my unemployment and some part-time. I hope that’s not what really happens.”

The “subsidy” will bite many, many people who calculate it based either on a low 2012 tax return or on a calculation like Ms. Guay’s and then end up with an increase in taxable income when they file their 2014 returns.

Imagine you earned $20,000 this year. Now imagine that your $20,000 income gets bumped to $50,000 by a windfall — it could be capital gain from a stock sale, a temporary consulting job, or a gambling win.

Warning! Real Data Ahead! ACA Supporters please stop reading here!
I ran those numbers at thehealthsherpa.com and discovered that the Gold plan Ms. Guay found might have a $981.26 base monthly premium but would cost the $20K earner just $321.53 per month thanks to a $659.73 subsidy. Unfortunately, with the windfall, that single insured person would have an unexpected “extra” tax bill of $7,916.76 due April 15, 2015, because the monthly subsidy on her $50 grand income drops to $0!

Kaiser Permanente says “In determining eligibility for exchange subsidies, income will be based on your attestation of your expected income in 2014 and will be verified by the exchange with documentation from your most recent tax return, with consideration of reasonable changes you expect. Exchanges will calculate enrollees’ household incomes using Modified Adjusted Gross Income, or MAGI. The MAGI calculation includes such income sources as wages, salary, foreign income, interest, dividends, and Social Security. MAGI calculation does not include income from gifts, inheritance and some other income sources are partially excluded.” More information on MAGI is available in a report from UC-Berkeley).

We are so screwed.

The Really Bad:
I compared what I have now to a “pretty good” similar plan with the closest deductible I could find.

Here’s the BlueOptions Everyday Health 1420 “Gold” plan on the Exchange. The Annual Deductible at $2,500 for me will be $50 more than I pay now. The co-insurance at 20% will be twice as much as my current coinsurance. The premium will be $1,084.67, or $653.67 per month more than my current premium.

My Current Blue Cross Blue Shield PlanOuch.

Here’s the Blue Cross Blue Shield plan plan I currently have. The plan Mr. Obama cancelled. The Annual Deductible at $2,450 for me is $50 less than the most comparable plan I can find under ACA. The co-insurance at 10% is *half* as much the coinsurance in the most comparable plan I can find under ACA. The premium is $431/month this year. The premium for the most comparable plan I can find under ACA will be $1,084.67 or 653.67 more than my current premium.

So the ACA that Mr. Obama guaranteed to let me keep my plan and guaranteed to save me money nearly triples my cost.

I am so screwed.

The Wugly:
Forbes analyzed the data. “If you’re healthy today, you will face steeper rate increases than these figures indicate. If you have a serious medical condition, however, and haven’t been able to find affordable health coverage as a result, you will do much better under Obamacare than the average person.”

“But Dick,” Ms. Guay said, “Now I have insurance that covers my pre-existing conditions and that I can afford!”


Too bad you liberals had to cover Ms. Guay by making sure young men pay thousands extra at the point of a gun. They don’t vote anyway.

Too bad you liberals had to cover Ms. Guay by making sure I pay thousands extra to change a plan I did like. Also at the point of a gun. I don’t cast enough votes to matter, either.

Too bad you liberals had to cover Ms. Guay by giving the insurance companies yet another welfare check instead of fixing the problem.

Too bad you liberals won’t guarantee the “subsidy” so Ms. Guay can afford that plan past the next election.


ACA forced carriers to cancel policies for 5 million people.
Meanwhile, Reuters reported that fewer than 27,000 people signed up for plans in October. About 79,391 more signed up through state-based exchanges, 30,000 in California alone.

100,000 sucked in … 5,000,000 shafted out.
Government in action, baby. Government in action.

Mr. Obama reversed course on Thursday and said millions of Americans should be allowed to renew individual plans and small group plans like mine just cancelled under his watch.*

Like Gov. Shumlin before him, Mr. Obama didn’t ask the insurance companies. Insurance spokesmen and state insurance commissioners immediately warned that prices will skyrocket.
* If the insurers refuse to reinstate now, of course, now they bear all responsibility for the cancellations.


2 thoughts on “Obamacare, the Good, the Bad, and the Wugly

  1. My employer health plan has been United Health Care PEBC. In ’09 I retired at 62 yo and transitioned into the same for retirees then stayed with it through 65 yo. For 2014 I will be paying about $290.00 a month for premium health, dental and vision if the morons don’t throw a wrench in the works. It paid off to dance with the one who brung me.

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