Obamacare 2016: ‘Savings’ hype masks higher deductibles, fines

Middle class continues to subsidize everyone else, paying higher ACA premiums, higher deductibles and increasingly self-rationing their own healtcare.

World renowned Obamacare Youth Mascot PJ Boy has not yet revealed if he'll be paying higher premiums, higher deductibles or a higher Obamacare fine in 2016.

WASHINGTON, Oct. 26, 2015 – The White House political hype machine kicked into high gear this week as 2016’s ACA (Obamacare) plans, prices and fine print for the 38 states now in the federal exchange became available for current and potential enrollees.

The administration is again hawking its costly income redistribution and health rationing plan as the greatest thing to happen to America since sliced bread, but the average American lucky enough to have a decent job already knows better. Cheaper prices for some policies are indeed showing up here and there.

But those subsidized prices are largely courtesy of America’s dwindling middle-class, the taxpayers who are footing much of this federal giveaway, along with the 30 percent of Medicare recipients who’ll be hit with as much as a 52 percent premium increase next year.

Read also: Obamacare problems will only increase in 2016

Not only will many working Americans find that their premiums are increasing significantly, they’ll also discover that funny little Obamacare feature that Democrats and the media absolutely don’t want to talk about: skyrocketing deductibles. It’s that little catch that will get you if you or your family happen to run into a medical condition that requires something more than routine care.

Until you meet your annual individual and/or family deductible, you’ll be eviscerating your savings accounts (for those who have them) to pick up the difference, and that can be a painful proposition indeed.

As a result, many Obamacare enrollees are being forced, in effect, to ration their own healthcare to avoid getting gouged by those unpublicized and very high deductibles. According to Laura Ungar and Jayne O’Donnell in a special USA Today report issued earlier this year,

A recent Commonwealth Fund survey found that four in 10 working-age adults skipped some kind of care because of the cost, and other surveys have found much the same. The portion of workers with annual deductibles — what consumers must pay before insurance kicks in — rose from 55% eight years ago to 80% today, according to research by the Kaiser Family Foundation. And a Mercer study showed that 2014 saw the largest one-year increase in enrollment in ‘high-deductible plans’ — from 18% to 23% of all covered employees.

Ironically, it is mostly the unsubsidized middle-class policy holders who are choosing these much higher deductible “bronze” policies to mitigate the effects of their higher premiums.

But this is like playing health insurance roulette. If you can get through 2016 without a major illness you win. If you or a member of your family runs into something more serious, you lose because you’ll have to pony up much if not all of that big deductible, negating if not totally eliminating the advantage of that allegedly “lower” premium.

Ungar and O’Donnell humanize the stark choices middle-class Obamacare recipients have before them when confronting something a bit more complicated than a sore throat:

LaRita Jacobs of Seminole, Fla., who gets insurance through her husband’s job and has an annual family income of $70,000, says $7,500 a year in out-of-pocket costs kept her from dealing with an arthritis-related neck problem until it got so bad she couldn’t lift a fork. She’s now putting off shoulder surgery.

“How did we get to this crazy life?” asks Jacobs, 54. “We’re struggling to pay our bills like we were struggling when we first got started.”

Welcome to Obamanation, 2015 Hope & Change Edition.

Another feature—not a bug—in Obamacare 2016 is the small matter of those Obamacare fines. Imposed on those who choose not to enroll in a qualified health insurance program for 12 months via either the federal exchange or one of the few state-run exchanges that remain, last year’s fine was negligible. But now those fines are beginning to increase. This year’s fines were either $325 or 2 percent of annual income, whichever is higher.

But in 2016, according to HealthCare.gov, it’s going to get a lot worse: “If you don’t have health insurance in 2016, you’ll pay the higher of these two amounts:

“5% of your yearly household income (Only the amount of income above the tax filing threshold, about $10,150 for an individual in 2014, is used to calculate the penalty.) The maximum penalty is the national average premium for a Bronze plan.

“$695 per person ($347.50 per child under 18) The maximum penalty per family using this method is $2,085.”

Obamacare fines
Obamacare fines,

This is the administration’s gift to the legions of young voters who supported him in 2008 and again in 2012. The key to keeping Obamacare somewhere within range of solvency is to coerce younger workers—those with generally far fewer health problems than older workers—to enroll in Obamacare plans, essentially subsidizing older policyholders.

But, as many of us will recall from our own younger days, young people are inclined to think they’re going to live forever, and health-issue free as well. That attitude, coupled with the subpar, post-Great Recession wages being earned by younger workers has led them to prefer the fine to the Obamacare premiums, at least up to this point. It remains to be seen if younger workers will be able to withstand 2016’s much-harsher penalties. It also remains to be seen whether they will be able to connect cause with effect when they confront the ballot box in 2016.

Whatever the case, thanks to the fecklessness of the Supremes, most wage earners not already on Medicare are going to have to confront Obamacare plans and premiums once again, starting next week.

Read also: After SCOTUS decision, watch Obamacare costs

For the third consecutive year, dates for signing up for 2016 healthcare coverage at HealthCare.gov have changed. The enrollment window this time is between Nov. 1, 2015, and Jan. 1, 2016. (State exchanges may have different enrollment windows.)

Also note, you’ll need to have enrolled in a plan by Dec. 15 in order for coverage to begin on Jan. 1, 2016.

In a future article, we’ll address the aforementioned healthcare premium horror show that will confront 30 percent or more of Medicare enrollees in 2016. Stay tuned.

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