I've been amazed at those who think that paying 17% to 23% of your annual income in medical costs is considered "affordable" when private insurers still get to deny your claims, give you the ol' administrative runaround until you reach your out of pocket maximum cap for the year, and they still get to game the system via regulatory capture thanks to the oversight of regulations being left to state insurance commissioners for each exchange in this Senate bill.
I've been running numbers in the past two days to show how 17% to 23% of your annual income can quickly put one into a medical bankruptcy or cause that family to lose their home, especially if that adverse event results in hospital bills that cost more than that family's monthly mortgage. I'll put these numbers in simple terms below:
For a family of four making $60,458, they'd be mandated to give about $5,797 in annual premiums in addition to $6,300 out-of-pocket expenses for a total risk of $12,097. Keep that in mind as I run the numbers below modeled after the one by emptywheel:
250% Federal Poverty Level
Federal Taxes
- 15.53% of income according to this rate sheet, to about $9,389 in federal taxes.
State Taxes
- Say, if that family of four lives in California, they'd be taxed at about 9.3% on their annual income, which comes out to $5,622 in state taxes.
Food
- Using this low-cost USDA plan for a family of four, they'd spend about $9,064 on food.
Home
- Let's assume a straight calculation of 30% of one's annual income towards housing, that would run out to $18,137.
Health Insurance
- Now, that health insurance plan which I mentioned above, would have a total risk of $12,097.
The total for all of this comes out to $54,309, which would be more than 80% of that family's annual income, leaving just $6,149 for utilities, transportation, child expenses, clothing, student loans. I don't know how that can be done on $512 per month left over in that family's budget.
That 250% FPL annual income I used came from Jonathan Cohn at TNR. You can run your own calculations based on how much you'd have left over for essential expenses on that spreadsheet. If I'm wrong based on my calculations, please let me know.
It's why the Congressional Progressive Caucus must push for affordability to be addressed in the final health bill, rather than the earlier implementation of reforms. If I had a choice between affordability and an earlier implementation of reforms in the bill, I'd go with affordability and finding way to provide that such as say, a real cost-cutting measure, the public option or some actual caps on your monthly premiums along with hard enforcement of the MLR ratio left up to a central national administrator, rather than left up to 50 different state insurance commissioners as is the case in the Senate health bill. Anyways, please join me in calling the Congressional Progressive Caucus today, and by signing our petition below to kill this Senate bill in favor of a better bill via reconciliation.
NEWS ALERT: Rep. Louise Slaughter says to "kill this Senate bill" and start over!