Below a snapshot of how health care reform would help one underinsured household.
A single profile is hardly a definitive assessment of how reform will affect the many families that are now paying far too much for far too little insurance.
But so much commentary on health care reform focuses on the uninsured or the well-insured. Most middle-class American families fall somewhere in the middle. This ProPublica assessment throws a spotlight on how reform would change their lives. (The analysis is based on results of a questionnaire that ProPublica did with American Public Media’s Public Insight Network.)
At the end of the Kroner’s story, I comment on what it highlights about reform legislation.
Mary and Mack Kroner
Age: 53, 57 Location: Austin, Texas Work Status: Employed Health Care Status: Underinsured with a high deductible Income: Combined $50,000 per year
Mary and Mack Kroner, of Austin, Texas, are both self-employed.
Mack is a self-employed cab driver and Mary is a self-employed writer; they both pay for their own health insurance. Though together they pay about $600 a month in premiums, they have what Mary Kroner calls “junk insurance.”
Rapidly rising premiums have forced them to increase their deductible every year, and now they have a policy with a $5,000 deductible per illness per year. That means that they’ve been paying essentially all their health care costs out of pocket. Mary pays $100 for her annual mammogram—a must because her sister had breast cancer—but she skips recommended pelvic exams. A recent colonoscopy recommended for Mack after he showed signs of bowel cancer cost them $1,376, roughly half their monthly income.
“We just bite the bullet and don’t attend to things because we can’t afford it,” Mary said.
What Health Care Reform Means for Them:
The Kroners would qualify to purchase insurance through a health care exchange because they are not part of a government program and do not have insurance through their employers. They could choose one from of an array of private plans, and one public plan, that conform to set levels of coverage.
The House plan would create a national exchange, the Senate plan state-based exchanges—and states would be able to opt out of the public option.
The plans in the exchange are likely to cost less for individuals like the Kroners because they pool risk, much the way that employer policies do. Setting levels of coverage also encourages plans to compete based on price.
Both the Senate and House plans would help the underinsured by requiring generous coverage for preventive care, like Mack’s colonoscopy and Mary’s mammograms. They would also cap out-of-pocket costs.
The Kroners would also qualify for government help in paying their premiums, but would fare slightly better with the Senate plan. Both plans offer subsidies on a sliding scale, which would ensure that people making less than 400 percent of the Federal Poverty Line would spend only a certain percentage of their salary on premiums. Mary and Mack make about 300 to 350 percent of the poverty line, which in 2009 is $14,570 for a family of two. Under the Senate plan, the Kroners’ premium would be capped at 9.8 percent ($4,900). That’s $2,300 less than they pay now. Under the House plan, their premium would be capped at 10 to 11 percent of their income ($5,000 to $5,500), which would save the Kroners between $2,200 and $1,700 from their current premium.
What the Story Highlights about Reform Legislation
Although the legislation’s critics argue that middle-class Americans cannot afford to pay up to 9.8% of their income (under the Senate plan) or 10 to 11% of income (under the House plan) for health insurance, the fact is that many Americans like the Kroners, who don’t have an employer helping them pay for insurance, already shell out more than 10% of their salaries for coverage.
And like the Kroners, in many cases, all they have to show for their hard-earned dollars is “junk insurance” that doesn’t cover many of the essentials they sorely need.
In other developed countries, the idea of budgeting 10% of a middle-class family’s income for national health care is not unusual. This is the price many pay to live in a country where everyone has access to high quality care.
In Switzerland, for example citizens don’t receive government help until they’re paying 10% of their salary for health care. In Sweden, the country’s chief health care economist told me that the taxes that go to fund the country’s health care program equal about 10% of the average family’s income.
The difference between Switzerland, Sweden and the U.S is that in Switzerland and Sweden, 10% of your income buys excellent care—and the security of knowing that you will always have access to that care. Under reform, Americans who have employer-sponsored insurance would keep it, and typically, they will spend far less than 10% of their income on insurance. (Many won’t realize that the cost of insurance means that their employers will have to forgo pay hikes.)
For families like the Kroners, who don’t have employer-based insurance, the U.S. would become more like Switzerland and Sweden.
Private insurers would not be allowed to sell insurance that didn’t meet high standards, covering preventive care, as well as doctor’s visits and hospitalizations. (Both the bill passed by the House earlier this month, and the legislation approved by the Senate Finance Committee call for the establishment of a federal benefits "floor," an essential set of medical services that all policies would have to cover.)
Moreover, under reform, insurers would not be allowed to charge co-pays for preventive care. This means that, down the line, Americans who receive timely preventive care will be able to avoid more aggressive and expensive treatments for chronic diseases.
This is how health care reform will fulfill its promise: lifting the quality of care while lowering costs.