Thursday, February 22, 2007

$5k Crunch

Shannon Corona had stomach surgery in 2004, but she has not been back to her specialist for a checkup in two years.

Her employer, a landscape architectural firm where she is a drafter, doesn't offer health insurance, and she says she can't afford it.

Can't afford it, or doesn't deem it necessary to work into the budget?

Corona is the kind of Californian who Gov. Arnold Schwarzenegger says would be helped by his proposed overhaul of the state's healthcare system. But compelling everyone to obtain insurance -- the linchpin of his plan -- may not work for many Californians in need of aid, according to health policy experts.

Under the governor's plan, nearly 1 million middle-class people would be caught in a tough bind, those experts say: They earn too much to qualify for the insurance subsidies Schwarzenegger wants the state to provide but not enough to afford comprehensive coverage.

How much is too much?

Only those whose yearly earnings are less than 250% of the federal poverty level -- about $25,525 for individuals and $51,625 for families of four -- would qualify for the proposed subsidies.

OK. $25k for a single certainly won't allow you to throw back Cuervo Gold shooters every night, but there should be something left for health insurance.

People earning more would be required by law to have, at a minimum, a high-deductible catastrophic insurance plan. Such policies, which the administration says cost about $1,200 per person a year, would not pay for anything until a patient's annual medical costs exceeded $5,000.

$1200 per year, $100 per month. That's about 5% of gross income at the minimum threshold. Should be doable.

And families could owe as much as $5,000 more in co-payments before insurers absorbed further medical bills.

And your point is?

Most folks have less than $500 a year in non-reimbursed medical expenses. Even if they had a bad year and incurred $5k in non-reimbursed medical expenses, how long will it take to pay that down?

Considering the average car new car price is $28,400 and many folks buy a new car every 3 years, what is the problem? The liberal left makes a big deal out of $5000 in non-reimbursed medical expenses like it is a big deal. No one seems to worry about the average credit card balance of nearly $9,000 which is usually purchases of things you really didn't need in the first place.

How many Ginzu steak knives do you really need?


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