There's always Starbucks
Life with no health insurance: Where domestic violence is a pre-existingcondition, rescission rules & haggling helps
One of my friends in Washington, D.C., just finished his PhD dissertation and interned at Amnesty International. He also works at Starbucks.
Why would a guy who now affixes Dr. to his name resort to menial labor in a city teeming with white-collar jobs? If you’re self employed or just out of college, you probably know the answer: Starbucks offers health insurance to part-time employees. The sad fact is, I know a number of college grads my age who’ve slung lattes for $7.25 an hour rather than go into business for themselves or find a part-time job in their chosen fields They just couldn’t afford to live without group health coverage.
Having bought my own insurance for three years, I can’t blame them. Below are a few things I’ve learned about obtaining coverage on the individual market for those of us who are just not chipper enough to serve overpriced coffee at 5 a.m. I wish I had better advice to give, but the fact remains that finding affordable healthcare is among of the toughest parts of being self employed.
I’m a healthy, 28-year-old male and even my policy’s price shot up 35 percent this year.
That said, there are a few things you can do to increase your odds of finding affordable insurance without an employer:
Keep it in the family
For many, signing onto a spouse’s policy provides an obvious solution. It’s also worth asking if the employer offers domestic partners benefits, which can apply to both same-sex and opposite-sex relationships that meet certain criteria. Another option is to stay on your parents’ policy. The recent healthcare reform law now requires insurance companies to cover children of policy holders until they’re 26 years old.
It’s also worth noting that children from low-income families have coverage available to them through Medicaid. Just don’t become pregnant if you buy your own insurance. Only a tiny fraction of individual policies cover childbirth, even if conception occurs after the plan is in force.
Buy your own
If you happen to be healthy, finding individual coverage can be surprisingly straightforward. Shoppers can browse Ehealthinsurance.com for policies just as they would Expedia for flights. (Or at least that would be the case if airlines charged middle aged passengers 10 times more than younger folks and didn’t let sick people on planes).
Dozens of policies will likely pop up if you live in Texas, which tends to attract more companies because it regulates them less than some other states. As with any insurance, you'll find the monthly premiums go down as the deductibles go up. Many self employed people chose a high-deductible plan then keep a tax-sheltered health savings account on hand to cover unforeseen expenses. In cases where health expenses make up 7.5 percent or more of someone’s income, that person can also withdraw money from an IRA to cover medical bills penalty-free.
Look for policies that cover office visits, specialists and prescriptions. Many don’t require you to pay off the deductible to take advantage of basic medical services at reduced rates. That said, make sure what you buy is actually insurance. A number of scammy “medical discount cards” offer reduced rates on services but are worthless in the event of a serious illness.
Control your information
You might think that a conversation about irregular bowel movements between you and a woman in a lab coat is confidential. It’s not.
Anything you tell your doctor, you tell your insurance company — and every company whose insurance you might apply for in the future. That doesn’t matter so much when an employer-sponsored plan guarantees coverage regardless of pre-existing conditions. For the self-employed, though, insurers are reluctant to issue policies without an unbroken chain of insurance contracts allowing them to examine every procedure, prescription and office visit you’ve ever purchased.
Sick people are expensive. A paper trail is one way to avoid insuring them and the reason it’s often tough to find insurance if you haven’t had it for awhile.
Much like credit reports, insurance companies also draw from vast databases of health-related information on individuals. Every year, you are entitled to a free copy of your personal file from the Medical Information Bureau, and it’s worth obtaining to ensure it doesn’t contain any errors about diseases you may or may not have that will affect your policy’s price.
Beware of rescission
Even if you buy coverage, there’s no guarantee you’ll actually receive the benefits you pay for. Insurance companies consistently face accusations that they save money by singling out those with expensive claims (like, say, breast cancer treatments), then instruct their winged monkeys to hunt down medical records that give the company contractual ground to cut those patients off.
Treated for a bladder infection at the college health center 10 years ago and fail to mention it on your insurance application? Good luck fighting that carcinoma while the bank takes back your house.
Rescission is illegal under the new healthcare law. The legislation also gives you expanded rights to appeal insurance company decisions.
All the same, I don’t exactly trust an industry that considers domestic violence a pre-existing condition to do the right thing. If I crash my bike and break my spine, requiring years of intensive surgeries and rehab, I honestly can’t say whether Aetna will honor the contract they entered into with me. Meantime, I’m sure as hell not telling my doctor anything more than I absolutely have to.
If all else fails, haggle
If you’ve lost you’re job, you’re legally entitled to keep your health benefits for 18 months, although even group plans can be prohibitively expensive without the employer kicking in its part of the cost. Organizations and trade groups occasionally offer group policies to members, so it’s worth asking self-employed colleagues in your profession where they buy their coverage.
If all else fails, haggle. Hospitals sell medicine to the uninsured the way Turkish merchants sell rugs to overwhelmed tourists. They start with the highest possible price anyone might possibly consider paying and allow themselves to be bargained down significantly.
Unlike everything else we consume, it’s impossible to know how much medical treatments actually cost, because every insurer negotiates prices with healthcare providers separately and in private. If you do wind up uninsured and facing a large bill, there’s a good chance a hospital administrator can cut it substantially by simply charging you the rates they’d offer an insurer.
Starting in 2014, the healthcare bill will set up “exchanges” in each state to simplify buying health policies on the open market. Combined with other regulations and tax breaks, they aim to reduce the cost of individual plans and increase their guaranteed benefits. Those denied coverage because of costly pre-existing conditions will be covered in so-called high-risk pools. No one knows for sure how all of that will work.
In the meantime, I guess there’s always Starbucks.