Since January of this year there have been hundreds of reports indicating that Obamacare costs are going up in many different ways. If anyone sat down and combined all of the cost increases to policy holders, it would be financially devastating to say the least.
Realizing the problems with ever increasing premium rates, the Obama administration took steps to try to keep out of pocket costs down for families. In a letter sent out by the Departments of Health and Human Services, Treasury and Labor, they announced a new rule that will take effect January 1, 2016.
Currently, many family policies have out of pocket more than twice that of individual policies. The new rule would cap the out of pocket expenses to no more than double that of an individual policy. The example given is:
“Under the rule, which was clarified in a letter sent to groups representing employers, a consumer who purchases a family health insurance plan will have an out-of-pocket cost of $6,850 for themselves or for a single family member – the same amount as someone with individual coverage. A family cap of $13,700 would apply if more than one person in a family submits claims.”
Costs applying to the out of pocket cap would include prescriptions, well-child checkups, mental health services, prenatal care and hospitalization. Electives such as cosmetic surgery costs would not apply to the cap.
However, the new cap on family out of pocket expenses only apply to the 10 categories of health plans covered in Obamacare along with non-grandfathered self-insured and large group health plans.
The reason behind the change was to try to secure a loophole in the UN-Affordable Care Act that allowed companies to force families to pay more out of pocket than they should be paying. Even though the Department of Health and Human Services approved the plan back in February, many insurance providers and others kept asking for clarification, prompting the letter.
It still boggles my mind to think that the federal government expects families to be able to afford $13,700 a year out of pocket expenses on top of the monthly premiums they still have to pay. I know some families that are paying $400 to $500 and more per month for their family healthcare coverage. Added to the out of pocket expenses, they would be paying $18,500 to $19,700 a year for their healthcare. How many average American families can afford paying nearly $20,000 a year for healthcare?
Every financial advisor tells families to keep their house payments to no more than 25% of their gross income. The median income for a household is about $52,000 per year. That means that up to 38% of their total gross income would be spent on healthcare. After taxes and house payments, that would leave the average family around $10,000 a year or $833 a month for all of their other expenses, including utilities, auto insurance, gasoline, food, clothing, telephones, cable or satellite TV/internet, home repairs, school supplies and other sundry items, let alone trying to save for retirement. Imagine a family of four trying to make ends meet on that kind of budget, and that’s with the new rule.
Barack Obama and his fellow socialists promised America a more affordable healthcare system. Instead they have made it the largest single expense for most families, even costing many of them more than their house payments.