Finance and Economics > The Money Board

Opting out of Affordable Care Act (Obamacare) is saving us a TON of money

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iam4liberty:
Well, we did it.  We opted out of the ACA (Affordable Care Act aka Obamacare) and it feels great!   By joining a voluntarist healthshare our medical choices are back in our own hands and the costs have dropped precipitously.  And we are shielded from any tax penalties from the ACA.

What is a healthshare?

A healthshare is group of people who join together to share their medical expenses among themselves.  Unlike insurance which is either run by a large corporation or the government it is a member controlled and operated group.  The group comes together and they structure a set of rules (called 'guidelines') for how medical costs are shared among them.  Each member contributes an amount monthly (called 'a share') which then gets distributed among the members to pay for their current medical care (called 'needs').   Some healthshares are manually operated where the 'shares' are matched with the 'needs' and members directly send and receive the funds from each other via check.  But many are now completely automated where the money is distributed electronically.

Because the members control the organization, it is not geared towards creating a profit for shareholders like corporate insurance.  This drastically reduces costs.  The cost savings just aren't from eliminating profits.  They come from greatly reduced charges by medical practitioners.  Medical practitioners build into their costs all the negative aspects of working with insurance; delays in payments, filling in bunches of forms, a staff to 'dance' with the insurance companies on getting them to approve services, etc.  This typically leads to a doubling of the cost of health care.  In contrast, medical practitioners extend their "cash" price to members of healthshares.   

At the same time since it is a member organization, the members can choose what types of proceedures are 'shared' which is typically much more expansive than that of private insurance.  For example, when Oregon passed its euthanasia laws many insurers started to refuse to continue paying for life extension medical care in favor of the cheaper euthanasia option (thus maximizing shareholder profits).  The healthshares in contrast chose to continue this coverage.  Another example is that most healthshares will cover alternative medical providers e.g. midwives for child birth and chiropractors.  In fact most healthshares are set up so you can use any medical practitioner you desire!

Because this is a voluntary organization it is also free from most government mandates.  Of course they have to adhere to some laws for example medical marijuana bans.  But the members can choose to ignore others, for example being forced to pay for abortifacients and 'rock star style' prescription drug habits.  To many this morally conscious approach is valued as highly as the cost savings.   That is one of the cited reason why the ACA bans new healthshares from forming, only the grandfathered ones are able to continue to operate.

How much can a family save vs. ACA? 

That, of course, depends on each individual circumstances.  But generally, a lot.  Here is the example for my family.

For 2018 we were facing a monopolistic situation as there was only one provider for our area on the government exchange.  The HSA compatible plan we were using was eliminated.  So here is what we were facing:

ACA

Providers: We would need to change doctor and hospital since our provider was not in-network for the new plan.

Deductible: $7340 for each adult, $14,700 for family.  We would need to pay this before receiving any medical benefits outside of a yearly 'wellness visit' and drug discount.

Co-pays: $40 for doctor visits, $20 Generic Drugs  (of two prescriptions for wife, only one covered).

Dental/Vision: None.

Prescriptions: : Our prescriptions would cost $137 a month under this plan.

Monthly: $882 per month. 

Instead we went with the premium healthshare program which included prescription/dental/vision discounts, $10,000 loss-of-life coverage (e.g. burial), as well as diet and exercise coaches to customize a weight loss program for us:

Healthshare

Providers: We can use whatever doctors, hospitals, and other providers we choose.

Yearly Unshared Amount: Healthshares don't have deductibles.  Rather, they have unshared amounts.  We chose one with an annual unshare of $1,000 for our family.  That is, once $1,000 is met in a calendar year everything is shared up to $1,000,000 per event.

Co-pays: None.

Dental/Vision: Discounted.  We will save about $180 a year.

Prescriptions: Our prescriptions will cost $63 per month.

Monthly Share: $508 per month. 

Net:  We will be saving ~$448 dollars a month which equates to $5,376 a year with the Healthshare vs. the ACA.  And if a serious incident occurs (e.g. heart attack, stroke) we will have saved the difference between the deductible and unshared amount (i.e. $6,340 if one of us, $13,700 if both of us).

It should be noted that we signed up for the most premium healthshare option.  There are many less expensive programs.  For example, a single person under 30 can get coverage within our healthshare for as little as $107 a month!

What are we giving up?

Because participants in our healthshare are pledging to live a Catholic lifestyle there are a small number of items that are not sharable.  They include:

Abortions and Abortifacient drugs
Contraceptives
Sex changes
Euthanasia (but on flip side you gain life extension procedures if you choose to use them)
Elective plastic surgery (e.g. face lifts, body tucks...reconstructive surgeries are included)
Recreational prescription drugs

In addition we pledge to avoid smoking, eat healthy foods, get regular exercise, drink only in moderation, avoid extremely risky hobbies like skydiving, and attend mass regularly.  For us, these things are not an issue, in fact they are encouraging us to live more healthily.

Does this work?

You bet.  I have talked to over a dozen people using them and all give it a big thumbs up.  The ratings on social media are also very high.  Here is an example testimonial: www.youtube.com/watch?v=ZPIdDplj7dg

And here is a discussion explaining more on why this approach reduces costs: www.youtube.com/watch?v=zUmX3u8-Tvw

For us this seems the best healthcare solution to, as Jack would say, "live a better life, if times get tough or even if they don't".  If nothing else, it is worth benchmarking other options against. 

mountainmoma:
Thanks for the report back !

The way these ACA plans are set up, they are like the old "catastrophic care" , you only get help after a large deductable, but the COST is way too high for that !

AvenueQ:
I've looked into these as well, but for me the problem is that all the ones I've found have religious ties and require some sort of statement thereof to sign up. I don't have a problem with that on principle, but we're agnostic (bordering on atheist), and I feel it would be wrong of me to sign an affirmation like that. Does anyone know of any that don't have a religious affiliation?

iam4liberty:

--- Quote from: AvenueQ on November 11, 2017, 06:09:10 PM ---I've looked into these as well, but for me the problem is that all the ones I've found have religious ties and require some sort of statement thereof to sign up. I don't have a problem with that on principle, but we're agnostic (bordering on atheist), and I feel it would be wrong of me to sign an affirmation like that. Does anyone know of any that don't have a religious affiliation?

--- End quote ---

I haven't come across any.   Early on the healthshares relied in part on religious exemptions in some states.  So the ones which got grandfathered in were religiously focused.  One of them, Liberty Healthshare, has a statement of principle which is very open but does require belief in God.  I will ask some of the contacts I made if they know of any.

iam4liberty:

--- Quote from: mountainmoma on November 11, 2017, 12:25:45 PM ---Thanks for the report back !

The way these ACA plans are set up, they are like the old "catastrophic care" , you only get help after a large deductable, but the COST is way too high for that !

--- End quote ---

Yes, even the HSA compatible ones are $900+ a month.   And this is with deductibles higher than what you can legally put in an HSA in a year!

True catastrophic insurance exists for $200 a month but the ACA made it so the must have spans less than 90 days and most are one month.  Otherwise no one would buy an exchange plan.  These plans will drop you from further coverage as soon as you make a claim.

Word is really getting out in rural communities about the healthshares.  With ACA premiums on farmers now reaching $30k+ a year and only covering doctors/hospitals in cities which could be hundreds a mile away, there really are no other legal viable alternatives.  And that is another advantage my wife and I see.  By our participating in a health share we are helping people like those in the below article rather then lining the pockets of the politically connected.

http://www.chicagobusiness.com/article/20170929/ISSUE01/170929835/you-think-your-health-insurance-costs-too-much-try-being-a-farmer

September 29, 2017
You think your health insurance costs too much. Try being a farmer.

John Kiefner, who farms 500 acres of hay in exurban Will County, has had health insurance from five companies in the past four years. One of them wouldn't allow his wife and him to visit any of their own doctors. Another wouldn't cover visits to the nearest hospital because it was out of network. All of them kept raising his premiums by 20 percent and more annually.

Kiefner will be lucky to net $75,000 on his farm this year. His last policy with Blue Cross & Blue Shield of Illinois was priced at $22,000 for annual premiums, plus a deductible of $5,000 apiece. That meant that he and his wife, Sherri, were investing $32,000, or 43 percent of their income, in health care before their insurer picked up any expenses.

Stretched too far, the Kiefners took out a deep-discount health policy earlier this year offered by Golden Rule ‚Äč Insurance that doesn't cover pre-existing conditions and is not compliant with the Affordable Care Act, better known as Obamacare. But at $6,000 for both of them, it was affordable.

"If my wife has a heart attack tomorrow and the insurance company finds out she had high cholesterol two years ago, I suppose they'll argue that was a pre-existing condition and won't cover us," says Kiefner, 53, who lives in Manhattan, roughly 50 miles southwest of the Loop. "But we farmers need some kind of protection. For now, most farm families are holding their noses as they pay up."...

One other option for farmers is switching away from Blue Cross and other mainline carriers to so-called health care sharing organizations, which typically are set up as religion-based cooperatives of sorts. Brad Hahn, CEO of Phoenix-based Solidarity HealthShare, heads one of 200 such groups and is attracting a growing customer base in Illinois. Hahn, a 49-year-old attorney, advertises on Christian radio stations and says his own family of four is covered for $449 per month, a quarter of what he used to pay.

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