With the impending requirement for nearly all Americans to carry health insurance, some penny-pinchers have started getting out their calculators. A number of self-employed and unemployed workers suggest it may be wiser (financially) to continue without health insurance, if the fine for doing so is less than the cost of the insurance.
Congressional analysts released a report yesterday that may cause them to rethink that idea, the Associated Press Reports.
When the next stage of the health care overhaul goes into effect in 2014, they estimate six million Americans will face the non-insured fine. That's up from their estimate of four million in 2010.
The average fine will cost $1,200 annually. That's far less money than the cheapest plan I found for myself as a single adult in New York. That plan would cost me $2700 annually, and considering it's $10,000 deductible, it would basically serve only as emergency coverage.
Personally, I'll probably chose to insure myself by 2014, given my aversion to just giving $1,200 away, and the hope that the healthcare overhaul will bring other cheaper plan options into the arena. And, there's also the upcoming self-insured tax credit to consider. Here's how Kevin Drum of Mother Jones broke things down for a family of four, based on their income, with that subsidy considered:
- Under $30,000, families qualify for Medicaid and pay nothing for insurance.
- Under $37,000 or so, most families can buy a bronze [lower cost] policy for free.
- Between $37,000 and $45,000, the cost of a bronze policy is quite small, and certainly less than paying the fine.
- Above $45,000, the cost of a bronze policy is a bit more than the fine.
- Above $50,000, the cost of a bronze policy is significantly more than the fine, but there aren't very many uninsured families in this category.
Here's what Drum says about people like me:
The numbers work out differently for single people, but singles under 30 also have the option of buying only catastrophic coverage. We don't know yet how much policies like this are going to cost, but certainly substantially less than a bronze policy. For most under-30s, this means they have the option of free or nearly free coverage all the way up to a fairly high income level.
So, there is a chance that buying insurance will still cost me more than paying the fine. But, the impending fine (and possible subsidies) will certainly make the financial case stronger for purchasing my own coverage.