Friday, August 12, 2016

A Philosophical Conundrum:

A month ago, I blogged on a client whose premium was jumping from about $700 a month to $1,000. One of the options we discussed was "going bare;" that is, declining to buy any insurance. Now, he could have potentially then become subject to the ObamaTax, but even that is a small fraction of what that increase represents.

He ultimately chose to keep his existing coverage (since he'd already met his annual deductible and was anticipating some additional expenses), but our discussion really brought me up short.

It wasn't that long ago that I castigated the subject of a newspaper article for making the choice to roll the dice by deciding not to be insured.

So what changed?

Everything, really: under the UnAfforable Care Act, it seems to me that choosing not to buy insurance is a rational choice. Although I would never advise going this route (cf: E&O coverage) there are certainly circumstances in which I don't argue very forcefully on its behalf.

Let's take Max: his current plan comes with a (low, by today's standards) deductible, after which covered expenses are paid at 100%. If renewal wasn't an option, he would likely be looking at a $4,000 deductible plan with a monthly premium of $852. Which means paying out over $14,000 (on an annual basis) before the insurance paid penny one.

Well, that's not quite true, either: the first dollar benefits include an annual checkup, which is worth some small fraction of that $14 large. Oh, and birth control and maternity, as well. For a 64 year old guy.

He'd save about $700 in ObamaTax penalties, as well.

But you see where this is going, right? It's absolutely a reasonable, rational choice to take a pass on an ObamaPlan altogether. And I hate that I not only see this, but (reluctantly, to be sure) agree with it.

blog comments powered by Disqus