Health Care Costs Increase While Our Income Goes Down

July 31, 2007

If you lost or quit your job today, how would you pay for health care?  Luckily for my wife, we can add her under my health insurance for a “reasonable amount’ when she stops working. 

Of course this means that as our income goes down our health insurance costs also go up. She was covered under her employer for only a small premium each month but the health insurance plan through my job really raises the rates for a family.familyHealthInsurance

Right now we’re paying $30 a month for health care insurance for my son and $15 a month for my wife’s premiums.  Once she rolls off her insurance at the end of next month our costs will go up to $87.50 a month.  Even though its much less than some people pay for health care it’s still quite a large increase in terms of percentage.

From what I’ve read, I don’t have much to complain about. I’m in the middle of Health Care on Less Than You Think: The New York Times Guide to Getting Affordable Coverage by Fred Brock (thanks to Jim) and Brock makes it sound like employer sponsored health insurance will someday be a thing of the past.  He predicts that as health insurance costs keep going up companies aren’t going to be able to pay for their worker’s insurance.  If Brock is right then an increase of only $57.50 a month in insurance premiums will be considered not bad at some point in the future when we have to pay for health insurance on our own.

It will be interesting to see the different health care reforms proposed by the presidential candidates over the next year.  The need to address the high price of health care and the number of people that can’t afford it is pressing.  While I’m complaining about paying $87.50 a month for insurance some people pay much more or can’t pay at all.  I really hope the next president takes some effective action to solve this problem.

Ben

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Ben

Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn’t like the other kids… His addiction to personal finance has paid off for his family and now he’s helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.


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Comments

8 Responses to Health Care Costs Increase While Our Income Goes Down

  • Ben

    Okay, I’m an idiot. I need to pay better attention to small print. It turns out that these rates are per pay period. Since I get paid every two weeks I’ll actually be paying $175 a month, yikes!

    Velvet, I’ve heard of insurance companies charging higher rates for people with certain health problem indicators. I don’t think our insurance company is doing this but it seems more are moving in that direction.

  • Velvet Jones

    While you pay less than some, I can appreciate that for your situation and lifestyle it’s a considerable jump. The thing that actually surprised me a little bit was the six-tier system used by your employer. They are really trying to spread the costs out, which is one of the reasons you are really feeling it. The most I’ve seen is a four-tier (employee only, employee + spouse, employee + 1 child, family). But as I’m sure you know, the higher insurance costs get for the employer, they more ways they are going to try to find a way to share the costs with the employee. On top of that, one company is tacking on surcharges for employees that have a BMI over 30, smoke, have high blood pressure, high cholesterol, and high blood sugar. Between $5 and $10 per “violation”, per paycheck.

    I agree with you, the next administration must address access to health care in this country.

  • bill

    I currently pay over $300.00 a month just for me alone. The policy I have has a $2500 deductible and a 20% copay up to $10,000. I shopped around recently and this seem to be inline with other offers I’ve received. If you’re paying less that $100 a month for you and your family, you ought to be thankful.

  • Ben

    I agree with all of you, the new rate isn’t bad compared to a lot of other plans available. Of course, to a cheap guy like me, any increase in insurance rates peturbs me.

    Angie, I agree. Depending on employers to provide health insurance is turning out to be a problematic model. I wonder what the politicians will come up with to replace it.

  • Angie Hartford

    There is something very odd about a society that relies on employers to provide health insurance for the majority of its members. I very much hope that we will be able to all have reasonably-priced health insurance within the near future.

  • One Frugal Girl

    Oh you should feel thankful for $87.50. I pay $230+ just for my husband and I. Add in Dental coverage and you’re looking at $260+ a month.

  • Brip Blap

    I pay $400 per month for family coverage. The pro: I’m a consultant, so frankly having any sort of coverage is nice. Another pro: it covers everything. The con: $400 per month is a lot of money.

    I think actually I’d be happier paying more if I didn’t have to get it through a company. If you told me I could do the same thing that I do for insurance – shop around for the best price for similar coverage – I’d be happy to. I don’t see any reason people shouldn’t be able to get health insurance the same way they get car insurance. There just needs to be some way to allow health to play into it so that if you’re healthy you can get better rates, while at the same time preventing people who are sick from being too harshly penalized.

    At the rate this country is going you’re going to be lucky to HAVE health insurance. Something dramatic is going to have to happen soon.

  • David

    That is not too bad, really. We pay over $250 a month to cover both of us with a high deductible.

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