Adventures in Obamacare

My cold wasn’t getting any better after two weeks so I went to the doctor. The receptionist asked for my insurance card. This is a “silver” Obamacare policy that costs $8,460 per year. I noticed that the co-pays are now higher than what the corresponding services typically cost not that long ago (and therefore higher than the market price today in a lot of rich countries). A generic prescription is $20; branded drugs will be $60 or $90 if they are covered at all. An office visit is $30 or $50. A few stitches at the “ER”? $700 co-pay.

My appointment was right after the lunch break so I was seen almost as fast as a dog would be seen at a vet. A sinus infection was diagnosed. “I used to prescribe Erythromycin for this,” the doctor said, “and it was a couple of pennies a pill. Now it is $200 for a course so I’m going to give you a Z-pack.” How was it possible for a generic to cost $200? “I think the generic manufacturer was acquired.” (Medscape says that “For example, erythromycin in 500-mg tablets had three increases of more than 100%. Its price increased from 24 cents per tablet in 2010 to $8.96 per tablet in 2015.” while Wikipedia gives the wholesale price at 3-6 cents in countries not subject to U.S. government regulation.)

[Separately, I posted this story on Facebook and a passionate Hillary Clinton supporter living in the Bay Area responded with

I know it’s crazy. Just this week I slightly scratched my back bumper on my car, but because my car insurance has a $500 deductible, I had to pay the whole thing myself. And to think I pay $1700/year in car insurance for me and my wife… clearly I’m losing money on this deal!

(or, you know, that’s how insurance works.)

Is the analogy apt? I haven’t had any health problems in the last two years nor changed my plan or vendor yet the cost of insurance has doubled while the emergency room deductible went from $100 to $700. I haven’t seen car, home, or aircraft insurance rates rise. In fact, my Obamacare policy now costs about the same as what a private owner would pay for insurance on a $2 million turbine-powered aircraft in which as many as 11 people might be killed if the single non-professional pilot should make a mistake. Thus it now costs as much to insure someone against the hazard of falling into the hands of the world’s least efficient medical system as it does to insure 11 people against the hazard of flying through the air at 300+ mph.]

22 Comments

  1. Grumpy Cat

    March 2, 2017 @ 2:47 pm

    1

    Why isn’t your insurance as good as mine (employer-sponsored HMO). My prescriptions generally cost $5 for generics, maybe $20 for some things. I don’t get it…

  2. Neal

    March 2, 2017 @ 3:21 pm

    2

    @Grumpy Cat: Your policy may cost more than 8,460 per person. HMOs generally provide better benefits for the same cost. Employed people tend to be healthier than average so employer based plans can offer better benefits at the same cost.

  3. PN

    March 2, 2017 @ 3:31 pm

    3

    Isn’t at least part of the story that Obama Care plans are subject to the following bad feedback loop:
    – young people with very few health costs opt out and pay the penalties rather than buying health insurance
    – people with pre-existing conditions buy the plan, the price of which is capped
    – since the pool of insureds is generally less healthy that it otherwise might be, the cost to run the plan is higher; so
    – the price of the insurance goes up; and
    – even more healthy people opt out

    My understanding is that by and large plan providers are losing money and are actively withdrawing from the exchanges.

  4. Chris

    March 2, 2017 @ 4:01 pm

    4

    Phil, you should ask the pharmacist how much the meds would cost you if you were paying out of pocket.

    After reading this lovely story below, I think that will be my first or second question when picking up future prescriptions.

    https://www.bloomberg.com/news/articles/2017-02-24/sworn-to-secrecy-drugstores-stay-silent-as-customers-overpay

  5. Jack

    March 2, 2017 @ 4:33 pm

    5

    For the self employed Obamacare is a disaster. Here in NYC most of the insurers have pulled out and there is only one reputable insurer left. It offers an HMO policy only and one that few US educated primary care physicians will accept. Nor the best hospitals. People often focus on the out of control costs, and that is important, but perhaps more important is whether good doctors and hospitals will really accept what you are paying for.

  6. Smartest Woman on the Internet

    March 2, 2017 @ 5:19 pm

    6

    The high premiums, high copays, high deductible, and zero subsidy of zero-care is prohibiting me from giving up my employer-subsidized health insurance and retiring early. I would like to see Medicare opened up to early retirees at, say, age 55 w/ a reasonable premium at perhaps double the rate of the regular Medicare beneficiary. That plan would open up a lot of job opportunities for older Gen-Xers and so on down the line!

  7. Max Lybbert

    March 2, 2017 @ 5:23 pm

    7

    Your complaint wasn’t just about insurance, so the “that’s how insurance works” response is a non-sequitur.

    Remember, several low-end insurance policies were considered too crummy for ACA. I think the complaint was that they didn’t cover enough, because the new and improved policies have higher out of pocket costs.

  8. Neal

    March 2, 2017 @ 5:37 pm

    8

    @Max Lybbert: Unlike the old policies, the new and improved policies must be renewed at the community rate even if you get sick.

  9. Max Lybbert

    March 2, 2017 @ 8:15 pm

    9

    @Neal: you’re right. I had forgotten about that feature.

    And it is a feature, but it isn’t free.

  10. jay c

    March 2, 2017 @ 11:27 pm

    10

    Phil,

    you have Russians in your family, yes? You can buy just about any medication without a prescription in Russia. Just ask your relatives to pack a few essentials (activated charcoal, Ampicillin, Erthromycin) in their bag when they visit. If it makes you feel better to have someone charge you $200 to look at you in your underwear you can do that and just give yourself the medicine the US doctor prescribes. The only problem with this approach is people from ex-Soviet Union are experts about everything, and they will tell you what is wrong with you without any prompting. You obviously got sinus infection because you didn’t wear your house slippers last Monday night! And, you need more fresh air, open a window!

  11. philg

    March 2, 2017 @ 11:30 pm

    11

    Jay: I should have listened to the Russians! I don’t think that my infection was bacterial. It improved over about 5 days. In the past when antibiotics have worked for me they have resulted in a huge improvement in the first day.

  12. the other Donald

    March 2, 2017 @ 11:45 pm

    12

    In aviation terms that sounds like a death spiral. Healthcare may be what finally brings out the pitchforks.

  13. Smartest Woman on the Internet

    March 3, 2017 @ 4:43 am

    13

    My husband’s Viagra is not covered under my husband’s employer-subsidized health insurance plan and costs $20 per pill with a prescription at the local pharmacy. He saves money by ordering generic Viagra from an on-line “Canadian” pharmacy for $1 per pill. Two weeks later, the discreet, brown-paper package comes delivered postmarked from India.

  14. tekumse

    March 3, 2017 @ 9:32 am

    14

    Some drug manufacturers also offer coupons and subsidized programs to pretend the increase is not hurting the poor. In some cases this is so complicated that they actually make less money now but get to claim more tax breaks.

  15. jack crossfire

    March 3, 2017 @ 1:24 pm

    15

    So regardless of the insurance bosses or government policy, don’t get health problems or marry people with health problems if you want to live.

  16. Smartest Woman on the Internet

    March 3, 2017 @ 6:27 pm

    16

    don’t…marry people with health problems

    I’ve immediately screened out smokers not only as a prospective spouse, but also as a prospective employee. That 25-year old smoker is going to be a basket case at 50.

    When I’m interviewing a job applicant if I can ascertain that she’s a smoker (or a graduate of a diploma mill or obese or crazy), then no hire. If one gets through the hiring process and, if on the first day when selecting fringe benefits, that person declines the $30/mo short term disability offer, they likely will not make it through the six month probationary period.

  17. Mike

    March 3, 2017 @ 9:12 pm

    17

    At least do the minimal price shopping you can do. For example, for prescriptions, go to the Costco pharmacy. You will be truly amazed how cheap the Costco pharmacy is compared to Walgreens or the local grocery store.

  18. George A.

    March 4, 2017 @ 9:03 am

    18

    Responding to the FB reply you got: Car and Health Care insurance are not the same. You can opt out of car insurance by choosing not to drive, and in some states, you can drive without a car insurance [1]. On the other hand, you can live in the US without buying health insurance, you will be penalized.

    Buying medicines from Russia and having it mailed to you: Be very careful with that. If the medicines you get in the mail are NOT from a registered pharmacy, the DEA will be knocking on your door for drug trafficking.

    Why Health Care cost is going up and will continue: Because unlike other services, it is no longer a form of free market. Yes, there are many providers, but they ALL work for the government now under the ACA.

    [1] https://en.wikipedia.org/wiki/Vehicle_insurance_in_the_United_States#Arguments_in_favor_of_compulsory_auto_insurance

  19. George A.

    March 4, 2017 @ 9:05 am

    19

    Moderator, please change:

    “On the other hand, you can live in the US without …”

    to:

    “On the other hand, you can NOT live in the US without …”

  20. Smartest Woman on the Internet

    March 4, 2017 @ 9:19 am

    20

    @George A.: On the other hand, you can live in the US without buying health insurance, you will be penalized.

    I think Pres. Trump has effectively voided the obamacare individual mandate penalty.

     CNBC.com, 01/24/17 – Trump gets rid of the stupidest part of Obamacare

    President Trump has basically signed the death warrant for the stretch of a policy known as the “individual mandate.” He did that by signing an Executive Order on Friday that instructs the Health and Human Services Department to do all it can to “grant exceptions from” or “delay” the enforcement of the mandate.

    Buying medicines from Russia and having it mailed to you: Be very careful with that. If the medicines you get in the mail are NOT from a registered pharmacy, the DEA will be knocking on your door for drug trafficking.

    My husband orders his generic Viagra from a on-line pharmacy (purportedly based in Canada), but the deliveries come postmarked from India. Should he be more concerned about the DEA or with what’s actually in those pills? (They do work, by the way!)

  21. George A.

    March 4, 2017 @ 9:50 am

    21

    @Smartest Woman on the Internet: as long as you get your medicine via a prescription submitted to a registered pharmacy, the DEA cannot come after you. Where the med gets shipped from doesn’t matter.

    As for the executive order regarding “individual mandate” and ACA [1], in my opinion, even if both Republican and Democrat agree to do away with ACA now, they won’t be able to: special interest, lobbyist, health care providers, pharmaceuticals, insurance providers, the public, etc. won’t let it happen. The public is too scared for a change, and the big players won’t give up their free ride profits of AHA.

    As an example, if you have kids, try to tell them they need to give up their cell phone. IF that is too extreme, have them give it up for a non smart phone (just calls, no texting, or data of any kind).

    Of all things we live off of in our lives, I cannot think of anything topping off health insurance for being so monopolized.

    [1] https://www.washingtonpost.com/politics/trump-signs-executive-order-that-could-lift-affordable-care-acts-individual-mandate/2017/01/20/8c99e35e-df70-11e6-b2cf-b67fe3285cbc_story.html?utm_term=.c40e5a648ab1

  22. Jacob

    March 7, 2017 @ 2:33 pm

    22

    This doesn’t help with erythromycin, but I’ve been seeing good mentions of a prescription cost-comparing site at goodrx.com – it searches non-insurance drug maker coupons.

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