We're still in shock ... over a letter we received this past Thursday. The letter was from our health insurance company, telling us what our actual premium will be next year. We were expecting (based on news reports) a 30% increase. Instead, we're told our premium will increase by 66%, to $2,371.14 per month ($28,453.68 per year). That's not because the benefits are increasing, either – just the opposite. Our out-of-pocket maximum is doubling, and the drug deductible is going up to five times what it was.
The letter explains why all this is happening, and the reasons are all-too-familiar to someone like me who has been following the issue. In short, the problem is exactly the premium death-spiral predicted by critics of ObamaCare when it was first proposed. Just as predicted, younger and healthier people are declining to buy ObamaCare because (a) it costs too much, (b) the penalty is relatively small, and (c) they can just sign up when and if they need it. With a risk pool that is older and sicker than the average population, guess what? Higher premiums. Also exactly as predicted: insurance companies are dropping out because they're losing money when the risks are higher than the optimistic ObamaCare proponents predicted. In other words, given the mandates and the rules around ObamaCare, these premium increases were inevitable – just as the ObamaCare opponents predicted. People like us (older, sicker, upper income) are the ones paying the highest differential between what insurance used to cost and what it costs today, because in practice the crazy-high premiums we pay are subsidizing everybody else's lower premiums.
Oh, how I long for the days of the simple major medical policy!
I have no idea what we're going to do about this, but most likely we're simply going to pay it. I have a meeting next week with our insurance agent to go over all our options, but I'm not sure we have any real options. Health care was already the biggest single expense in our budget; now it will be even more so.
I can't help but wonder where all this ends. Will the politicians allow ObamaCare to actually follow the premium death-spiral until all the insurance companies drop out? So far that's what they're doing. Then what? Single-payer time? I can hear the progressives slavering at that opportunity, which scares the hell out of me. ObamaCare repeal and a return to “real” healthcare insurance? Don't see much political support for that, damn it! Will medical tourism take off, sending Americans to Mexico, India, Russia, or Estonia for any non-trivial procedure? That's already starting! This is turning into one of our biggest concerns for our retirement, which is not what I expected us to be worrying about!