What is the real cost of private health insurance compared to marketplace plans?
It’s about that time of year again. Ever since November 2013 anyone looking for health insurance has gone to HealthCare.Gov and scoured the site for an affordable health insurance plan. If you are looking for an individual plan and your gross household income is over $50,000 per year than you won’t qualify for any subsidies and the rates have rose on average of 17% 7 years in a row. To give an example as of October 2020 a 40 year old male in South Florida that makes $72,000 per year and is single would pay $550 per month for a silver marketplace plan with a $5500 deductible and a $7,500 max out of pocket. If you have a family of 4 and gross household income is north of $70,000 than you wouldn’t qualify for any premium help either and your insurance premium would be north of $1600 per month with gold plans reaching $3,000 per month. With the insurance premiums on the marketplace going up year after year this has created an influx of applications for private health insurance. The cost of private health insurance can sometimes be up to 80% less expensive than the same clients option on the marketplace do to private plans being a la carte. You are able to pick and choose what you’d like to pay for in your health insurance plan. Sounds like that’s how it should be right? Unfortunately not, private plans give you the ability if you are a family of 4 in your 50’s and you won’t need pregnancy coverage anymore than you are able to take that off your plan and not pay for it. Allowing individuals and families to choose what coverage is most important to them is a huge factor in driving down cost. Private health insurance is also underwritten so you can get huge discounts if you’re the type that sees the doctor once or twice per year and really just want health insurance for catastrophic claims. To give you an example that same family of 4 that would be paying $1600 per month on the marketplace can apply for a private plan with no deductible for around $800 per month. Pretty much cutting their premium in half if they are able to qualify for an underwritten plan with no major health conditions.