As recent readers to my blog know, I've been going through the process of collecting information to make a decision about my family's health insurance needs for the future. And since there are so many of you that have been following along, both for entertainment value and for personal information, I figured it was only fair that I publish the decision I made, and why.
To recap: I've been buying health insurance for myself and my family on the individual market for the last 12 years (actually longer than that, but there was a break in the middle when we bought a group plan for the company while running Computer NERDZ! in Austin, but I was the point-man on buying that plan, too). We're fortunate that we're relatively healthy, and have (almost) always been considered "low risk" by the insurance underwriters. We change plans every year or two when costs start rising, but essentially we've always had the same type of plan.
ACA introduces a huge wrinkle into this for us, as I've detailed elsewhere. In short: ACA plans are currently priced at about double what our current plan costs us.
Our current insurance plan is set to run through July, 2014, after which it will be canceled if I take the letter I received at face value. At that point I'm still mandated by ACA to carry coverage so I would have to buy an ACA-compliant plan starting August 1, 2014. And unless those prices come down between now and then (in New Hampshire I don't expect them to change in either direction), I'll wind up paying nearly double.
My insurance company offered me the chance to renew my current plan early on December 1, 2013. As I understand the law, they are not allowed to renew my existing plan after 2014 starts because it doesn't fit the ACA requirements (we choose not to carry maternity or mental health prescription coverage - the premium costs don't pay off even if we needed the coverage), nor will New Hampshire participate in Obama's attempted one-year cancelation reprieve (some other states will).
Early renewal will raise our premiums by $46/month (from $487 to $533 for a healthy family of four). Eight months of that (December thru July) comes with an opportunity cost of $368. That number actually goes down when you factor in what even a normal 20% renewal increase would cost me if my plan were to be renewed on August 1, 2014. In the end this is a $164 gamble, spread out over 8 months. And that $164 gamble guarantees me an extra four months of coverage on my existing plan. More importantly, it guarantees me predictable coverage (and rates!) up to within a month of the start of 2015, when it's possible new ACA laws/conditions and, most importantly, rates may go into effect.
I'm hopeful that by 2015 we'll start to see some reality factored into ACA rates. Right now the insurance companies are doing a lot of guessing (and with all the changes in the law and the politics, I can't blame them!). No one really knows how many people are actually going to buy coverage despite it being mandated. No one knows who those people will be. NHPR did a helpful infographic where they show how the high risk and individual pools are being merged in our state, and they also predict that in 2016 there will still be 41% of the people not choosing to buy insurance (despite the mandates). If correct, that's astounding to me. Isn't the whole point of ACA to ensure everyone is insured?
If anything significant develops that impacts my thinking on this you'll hear about it from me. But don't expect daily or even weekly updates now that I've made my decision. My goal here is not to preach... just inform about what I'm deciding for myself and my family and why. Either way, I'll certainly have more to think about (and say!) in 11 months as I decide what to do for 2015.