The fabled self-starter is often the hero in books and movies in America. The individual that heads off into the wilderness to find their place in the world or builds an ingenious contraption in their basement or creates a fortune out of gumption and grit. In this modern age, we still look to the entrepreneur or the self-employed as something of a mythological creature. Someone who will ignore the predictability of the corporate safety net and face an uncertain future on their own terms. And, before 2014, they did so without health insurance.
Before the Affordable Care Act (or ObamaCare) became law, it was difficult to get insurance if your employer did not offer it because it was prohibitively expensive, had high deductibles or was considered catastrophic coverage. One of the great boons of the Affordable Care Act was the creation of the Marketplace for health insurance. Self-employed and others who did not have access to health insurance through their employer, now had access to health insurance at reasonable prices.
Before that point in time, whenever conversations landed on the topic of self-employment or entrepreneurship, the conversation would eventually hit upon the problem of health insurance. The most common remedy was to have a spouse or partner with a corporate job that provided access to health insurance for the family. For those who found themselves in a situation similar to my partner and I, in which both of us are self-employed, the only options available were very expensive or very limited.
Our honeymoon with the Healthcare Marketplace ended the following December when the next enrollment period began. Our premiums jumped 30%. There were articles and reporting in the major news outlets about the surprise of the cost of insuring everyone that signed up through the marketplace. We were disappointed, but we were simply happy to have the coverage. The real problem occurred the following year. And the year after that, and the year after that with the steady and eventually predictable rate increases. What we did not notice at first was that as rates were increasing, so was the deductibles. We also discovered that the copay was often changing and never in our favor.
This year, when we signed into the Healthcare Marketplace to renew our health insurance we found that we had to also sit down and go over our family finances. Since we first signed up at the end of 2013, our health insurance premium had more than doubled. Our deductible had tripled. We were being priced out of coverage. Although ‘catastrophic coverage’ insurance policies were outlawed when the ACA was put into law, the policies that were available to us were looking eerily similar to such policies but at the price of a regular policy.
After going over our finances and looking at the options available to us, we made a decision that we had been worrying about for a number of years. Starting in 2020, we are not enrolling in a healthcare plan. We will take the money that we have been paying towards our premium and putting it into a savings account.
We realize that for the first year or two, we are taking a pretty big risk. And, if either of us suffers a catastrophic illness or injury, we will be in trouble. Part of the reason we made this decision is that we realized that if we had continued paying for health insurance and either of us were unable to work for any reason, we would not be able to continue to pay the insurance premiums. We would lose the insurance anyway. The only difference, from our perspective, between having insurance and losing and not signing up for it in the first place is saving the premium payment.
We are not particularly happy about a situation that we feel we have been forced into and it is not a decision that we have taken lightly. I imagine that we are not alone in having to face this financial dilemma and probably not alone in how we chose to deal with it. Being in our 40’s without health insurance is not a situation that we imagined for ourselves, but with a bit of luck and some time, we will be OK.