Friday, March 24, 2017

Understanding ObamaCare - my story

This article was slightly edited on Sunday March 26 to eliminate sentences 
that may have been confusing.
Speling and gramer errors were left in because the wife loves to find them and give me grief about them.

 My wife retired at age 51, and four years later I retired at age 51 too (in January 2005).

We were both happy with our Blue Cross medical insurance from January 2005 through December 2013 ... before ObamaCare forced us out of it in January 2014.

When forced into ObamaCare in January 2014, I had to 'manage" our taxable income to make it very low for that year, in order to get big ObamaCare subsidies.

We needed subsidies to be able to afford medical insurance in 2014 -- because our price tripled from December 2013 to January 2014 (it is impossible for working people to manage their taxable income like we did, as retired people, living on our savings).

ObamaCare forced us to take government handouts for the first time in our lives, and we did not get the insurance plan or doctors we wanted.

However ... ObamaCare, after those huge subsidies, did cut our insurance bill in half ... and I am now "hooked" on ObamaCare until I can start Medicare in late 2018 (the wife left ObamaCare to start Medicare in mid-2014).

That's why the ObamaCare story is so complicated.

ObamaCare made individual insurance much more expensive, with huge deductibles, for millions of people ... but cheaper for those people with low taxable income who were eligible for large government subsidies.

 ... and ObamaCare also led to free, or nearly free, Medicaid for about 12 million people just over the poverty line who became eligible for Medicaid ... but only in those states that agreed to take federal handouts for a few years to pay for almost all of their above-the-poverty-line Medicaid patients.

There were not 24 million people getting insurance for the first time with ObamaCare.

That number double counts at least six million of people like us, forced out of our pre-ObamaCare policy, and forced into an ObamaCare-compliant policies

When our goobermint gives out freebies, some 'takers' get hooked on them, and will scream if any politician tries to discontinue them.

I should know -- I'm one of the 'takers' !

The dilemma:
It's best for our economy to completely repeal ObamaCare -- we couldn't afford the existing "entitlements" (Medicaid, Medicare and Social Security) before adding a new entitlement: The ObamaCare subsidies.

This is a tough choice for Republican politicians.  

As a forced into ObamaCare customer, starting in January 2014, I understand how bad the law is -- most people talking about the subject have no clue.

In late December 2013 it took me two hours on the phone, with the help of a Michigan Blue Cross representative in a three-way conversation, to get our first ObamaCare policy started for in January 2014, with the right subsidies, when the goobermint Obamacare website would not work.

My wife and I retired very young -- age 51 -- after I estimated our future health care costs to determine whether we could permanently stop working.

In my first month of retirement -- January 2005 -- we paid $192 per month for Blue Cross medical insurance for both of us, with a family deductible of about $1,000.

Just before we were forced out of our Blue Cross plan at the end of 2013, by President "You can keep your plan" Obama, we were paying about $350 per month -- still affordable, but a larger rise from the $192 in 2005 than I had expected.

ObamaCare immediately tripled our insurance cost for 2014 to about $1,050 per month -- with a deductible of about $5,000 (rarely would we reach a $5,000 deductible in a given year).

That was more than we could afford as people who retired very young (an ObamaCare-compliant policy, or no medical insurance at all, were our only choices until our Medicare years arrived).

Fortunately, we live on our savings, and I could "manage" our taxable income for a few years by withdrawing much more of our spending money from an after-tax savings account (withdrawals not counted as taxable income) ... and withdrawing much less from our tax-deferred IRA accounts (where withdrawals would be counted as taxable income).

The result is we were able to report very low taxable income for a few years, and get a huge subsidy for an ObamaCare policy.

And just as important, people reporting a very low taxable income, get much lower ObamaCare deductibles.

I'm not breaking any laws doing this, or using my MBA Finance degree for a clever tax evasion scheme.

I was just reacting to ObamaCare rules that tripled our monthly medical insurance cost from about $350 a month in December 2013 to $1,050 a month starting January 2014

As a result of ObamaCare, our monthly medical insurance expenses, after government subsidies, have been about half (or less) of what we paid Blue Cross in 2013.

But note that to keep spending low, each year I deliberately select the lowest cost, or near the lowest cost, ObamaCare Silver Plan (20% co-payments).

The cheap plans I select every year always seem to raised their price a lot the next year.

So every year I was forced to switch to another insurer that happened to be offering a 'cheap plan' that year.

My really cheap 2016 plan, for example, raised their price for 2017 so much that my monthly bill, after subsidies, would have been up an amazing six-fold (700%) in 2017, believe it or not.

Once again I had to switch plans -- choosing another company's 'cheap plan' for 2017.

I'm very fortunate we live in Oakland County, in the Detroit metropolitan area, because there are a lot of ObamaCare-compliant choices, and at least one bargain plan has been available every year.

For one year -- 2015 -- I was able to time my IRA withdrawals to report low enough taxable income to qualify for the Healthy Michigan Plan (which is a new "ObamaCare" Medicaid plan for people just over the poverty line, with no asset test, and almost free -- original Medicaid is for people under the poverty line, with very few assets, and is free). 

I got some dental work paid for by the Michigan Healthy Plan, which would have been paid out-of-my-pocket with any non-Medicaid ObamaCare policy (so I saved a few hundred dollars that year). 

I can't comment on the quality of any doctors available for ObamaCare, or the Michigan Healthy Plan (Medicaid).

The reason for that is visiting a doctor boosts my blood pressure a lot, which already high 365 days a year, so I have not visited any doctors since 2011.

I can report that President "You can keep your doctor" Obama was also lying about keeping your doctor!

I have studied the lists of doctors, and picked a "primary care" doctor each year, when I had to do that, but I've never met any of the doctors.

I can report a lot of doctors on the ObamaCare lists had surnames I can't pronounce (even more so with Michigan Healthy Care doctor's list) but I don't know if that tells me anything of value about their medical skills.

This all adds up to me wanting ObamaCare to continue at least until I turn 65 in late 2018, and start Medicare (ObamaCare subsidies are only for people under age 65).

I don't know what medical Insurance would cost me in 2018 if ObamaCare was repealed in 2017 -- probably a lot more.

I'm paying $65/month this year after huge subsidies, from a very low taxable income, in a year where I'll turn 64 -- that's a bargain. 

If ObamaCare is not repeaIed, I'll probably get a big rate hike for 2018, and then have to find yet another insurance company, offering a cheap ObamaCare silver plan, for 2018 ... usually meaning I'll be changing my primary care doctor yet again. 

I'd hate to live in an area where just one company offers ObamaCare-compliant policies.