This is a diary about numbers and dollars. Specifically the number of dollars I pay each month to avoid bankruptcy and also pay some of my family’s medical expenses.
First number: $1,216 per month for health insurance via COBRA. You see, my wife as a retiree of Eastman Kodak (she retired due to disabilities resulting from pancreatic cancer) had her health care benefits eliminated last November by the Bankruptcy Court administering Kodak’s Chapter 11 proceeding. As a result, our family is now covered by the health insurance benefits allowed under COBRA.
Basically we get to continue on her old group medical plan, but now we pay all the costs of the insurance coverage. This continues for 18 months. Fortunately, as my wife was granted SSDI benefits related to her multiple disabilities, she is now covered under Medicare, so she will never lose coverage – uh, well assuming Medicare for pre-retirement disabled folks is not bargained away in the future as some sort of deficit reduction package. But I digress …
When you add all those monthly payments together, you get my second number: $14,592 per year to cover my daughter, my son and myself until June 30, 2014.
(My disabled wife, as previously noted, is covered by a Medicare Advantage Plan which costs roughly another $4000-5000 per year, but to simplify things we will just go with numbers applicable to health care coverage for the rest of our family).
Now technically this $14,592 pays for health insurance, but to my mind its only real value is as insurance against a bankruptcy necessitated by a medical catastrophe to one of my children or to myself. In other words, hopefully, should I get cancer, kidney failure requiring dialysis, develop a heart condition, get hit by a bus or need other extremely expensive medical care, I won’t have to pay 100% of the cost, pile up massive debts and file a Chapter 13 or Chapter 7 Bankruptcy petition to cancel out those medical debts.
Here’s what my $1,216 a month gets me.
(cont)
The Deductible
$2500 out of my pocket before my insurance pays a dime for care. That’s my “in network” deductible amount for the year. I’m not complaining, I know people who have it worse.
So, in reality, I pay $14,592 + $2500 = $17,902 (my 3rd number) for my health care coverage because we always use up our deductible each year.
There is also a $2,500 deductible for out of network expenses, i.e., if we need to see a doctor or have to go to a hospital that is not within the “network” of my insurance plan, there is a separate $2,500 we would have to pay out of pocket. We try to avoid seeing anyone not in our plan’s network, and fortunately for us most of the health care providers for our community are “in network.” That may change when my daughter goes away to college this fall. I’ve told her she’s not allowed to get so sick she needs to see a doctor while at school, or God forbid, hospitalization. But let’s assume my daughter won’t need medical while she’s away from home.
Bad News – The stuff that’s not covered that we pay for
My Hearing Aid.
– Lucky for me my hearing aid still works and is under warranty until July. After that, if it breaks I’d have to pay for a new one myself (cost roughly $2,500-$3000). I have a 60% hearing loss in one ear, but with my daughter going to college this fall, if my hearing aid broke, I probably wouldn’t replace it.
Cost of Eye wear:
– Last year I needed new lenses. Hopefully that won’t be the case this year.
Dental visits (unless my teeth are damaged in an “accident” – a term defined extremely narrowly)
– Of course I don’t have dental coverage! Who does (don’t brag about it if you do)?
Last year because my teeth keep breaking/fracturing (probably related to medications I take for my autoimmune disorder: TRAPS) I spent roughly $2,000 repairing my teeth. I just cracked another tooth below the gum line. Tomorrow I go to find out if what’s left can be salvaged or of it should just be pulled. Forget about implants – those are too expensive for me. Even a crown is pretty pricy. Having a tooth pulled is probably my best and cheapest option.
Prescriptions not on covered list
– Basically anything that isn’t a generic drug the insurance plan will not cover, which is too bad since there are a number of possible medications that might help my autoimmune disorder that I cannot take because they would cost me thousands of dollars a month. Instead I take a corticosteroid – prednisone – for my frequent “flares” (That’s medical jargon for when my symptoms get so bad I need something to make them less bad so I don’t end up in the hospital). Prednisone has a lot of nasty side effects (lowers resistance to infectious disease, increases risk of cancer, lowers bone density, causes psychological issues, etc.) but that’s all I’m allowed to take.
The Good News
No Lifetime or Yearly Maximum Benefit
Our health plan doesn’t have a lifetime or yearly limit on medical costs, so until June 30, 2014, if I get cancer or need heart surgery, etc., I won’t go completely broke. I can’t max out, unlike some people. Trust me that is very good news for us, at least until our COBRA insurance is up.
However, I will be liable for 20% of all “in network” costs (40% if out of network) related to expensive treatments like chemotherapy or dialysis, etc., assuming of course that my insurance plan trustee agrees that those treatments are “medically necessary.” Let’s hope I don’t ever have to find out that what my doctor says is “medically necessary” to treat a life threatening illness disagrees with some bean counter’s opinion on the matter.
We also have to pay 20% to 40% of the cost of all doctor visits (specialists are often at the 40% level) and medications (depends on the drug) not including chemotherapy.
Last year we paid over $6,800 for drugs out of pocket. Admittedly a lot of that was my wife’s meds, which are covered by Medicare, so they weren’t included in the deductible amount of my plan or for purposes of calculating our maximum out of pocket limit (see below).
Still, if my kids or I ever get prescribed a really expensive drug that gets approved by the insurance company managing our plan (other than chemotherapy and certain other exceptions), our yearly out of pocket costs are capped at $7,200 – the aforesaid Maximum Out of Pocket limit. Last year we didn’t reach that limit. We avoid seeing the doctor unless absolutely necessary.
Hospice Care
Hey, this is covered in full (after meeting our deductible)! So if I am diagnosed with a terminal illness, this is probably what I’ll opt to do, rather than trying to prolong my life with expensive treatments that may or may not be covered. So, that’s all good, too, I guess …
The Bottom Line
Well, the bottom line is that my insurance coverage “probably” would allow me to avoid a bankruptcy caused by a catastrophic medical condition, and it also benefits the manufacturers of the generic medications we use. Of course, under the COBRA rules, after June 2014, all those lovely benefits go away. I sure hope I can find some medical bankruptcy – er, health care insurance after June 30, 2014 that we can afford via the NY State health insurance exchange that is being established under the Affordable Care Act.
Those exchanges go into effect next year – assuming Congress doesn’t defund them or they otherwise get “bargained away” somehow in deficit reduction negotiations. I’ve heard that the ACA is not on the table in said negotiations, but then we were told the same thing about Social Security and Medicare, so …
