As the public debate rages on as to whether or not the Affordable Care Act (Obamacare) really makes health insurance affordable, let us discuss the true cost of health insurance to individuals, couples and families across America.
Most people get health insurance from the company they work for as a benefit. It actually is a very expensive benefit that if employees had the option of taking the cash instead and buying their own insurance they would do just that. When a company buys health insurance for their staff, the insurance company gives them four prices. A price for Single Coverage, Single plus Child, Married, and Married plus Children. What the insurance company does not do, is break down the pricing by age. This causes companies who offer health insurance benefit to pay close to $1000 for single coverage and almost $2000 a month for family coverage. The insurance company assumes that every employee of the company is 52 years old and prices the insurance policy for a 50 year old.
A married couple, aged 25 years old, can find health insurance from a company like Blue Cross & Blue Shield for prices ranging from $200 a month to $500 a month. Interestingly enough, if we look at the price of health insurance for a 45 year old couple the range of prices goes up to $250 – $750 a month. Notice that is it still cheaper than the $1500 a month that your employer is paying for your coverage.
When do we find $1000 a month coverage? When the couple is over 50, or 55 years old to be exact, the price range for health insurance jumped to a range of $500 to $1200. If we were to add an 18 year old son to the 50 year old couples family then the prices goes up another $100 a month.
What the affordable care act does by forcing all citizens of America to have health insurance, it brings more 25 years old into the world of health insurance and brings down the overall average costs for everyone. Just like the company we spoke about earlier in which the insurance company charges them $1000 for coverage regardless of age because they need to be concerned about the 62 year old employees like the 23 year old employees so they charge the higher rate. The ACA hopes that by having a bunch of 25 year olds signing up for coverage will bring down the overall average cost so that a 60 year old will pay less because the 25 year old paid more.