Unknown: Workers are quitting their jobs in record numbers
part of what is now called the Great resignation. around 4
million workers have quit their jobs each month between July and
November 2021. American workers who are becoming their own
bosses maybe gaining new financial freedom, but they're
losing a big advantage health insurance benefits. Over 54% of
Americans had insurance through their employer in 2020.
One of the reasons that I almost never considered leaving a staff
position until recently was because of health insurance.
The great resignation might be even greater if it weren't for
the way our health insurance system was constituted
one in three insured workers would consider leaving jobs if
health insurance weren't a factor.
This system isn't easy to navigate, it's really difficult
to figure out how much insurance is going to be even as a self
employed person.
Many Americans turn to the Obamacare marketplace to find an
insurance plan. The Biden administration announced that
signups hit an all time high in December 2021. There are
significant limitations in marketplace plan coverage that A
you can't easily see. And B that make the coverage meaningfully
different from what you may have been, you know, used to from
your jobs.
I don't think there is a more important or complicated
decision to make than picking a health insurance plan.
So can Obamacare work for this influx of uninsured Americans
and what's the lasting impact of the great resignation on health
care coverage? The Affordable Care Act frequently referred to
as Obamacare establish the health insurance marketplace
where people can find medical insurance plans from private
providers that are not tied to their jobs. Erica Lehman left
her job in higher education to work on her wedding photography
business full time, she looked for a new insurance plan on the
marketplace.
There were so many options and all of them seem just kind of
like a lot of money for not a lot of support.
Since marketplace plans are offered by private companies,
there's no limit to the number of people who can get their
insurance through the Marketplace. That means people
participating in the great resignation won't be shut out.
increased participation in the marketplace may even encourage
insurers to adjust their offerings. In fact, the number
of insurers participating in the marketplace increased in 2022.
Individual health insurance plans are extraordinarily
expensive, you need to be in a group in order to have really
the benefits of a group insurance. If you're not in a
group, you're gonna have very high copayments and deductibles
and high insurance costs.
71% of uninsured Americans who decided not to get insurance
from either a private insurer or through the Marketplace said
they didn't end up buying a plan because it was too expensive,
according to a 2020 survey by the Commonwealth Fund. Nicole
D'Onofrio left her staff position as a digital marketing
consultant to start her own business. She also turned to the
exchanges to find an insurance plan.
My previous job covered all benefits for an individual. So I
never factored in health insurance into any type of
expenses that I had, I didn't even realize were such great
benefits until I left.
If you're trying to find a plan that is the same or virtually
the same as what you had at work, you might not be able to
do that. Marketplace plans, they have much higher deductibles, on
average, most of them have much narrower provider networks. So
if you have you know a condition you're pregnant, there's a
doctor you're going to see now, there's a decent chance that
that doctor will not be in all or even any of the networks of
the plans that you look at. And you're going to have to go
through and look at each network.
Health insurance is a big perk of working for a company and
workers know it. 26% of Americans would be very or
somewhat likely to start their own business if health insurance
wasn't a factor.
Even if you were a ruthless capitalist who was totally
opposed to socialized medicine, you would have reasons to be
concerned about the way we're doing things if health insurance
is holding people back from the perfect job or from starting
their own business potentially that is an invisible brake on
the productivity of our economy.
Politicians want to be elected and reelected. So they're going
to listen, I hope.
The government does offer subsidies in the form of a tax
credit that help qualified Americans pay for a Marketplace
plan. The vast majority of people who get coverage through
the marketplace qualify for subsidies for premium tax
credits that will reduce the amount you pay each month. So
the premiums are pretty affordable for most people. The
rules of whether someone qualifies can be difficult to
follow. The requirements are based on age as well as income
and vary by location. Additionally, people who have
options to get their insurance through another source such as
an employer or through a spouse usually do not qualify for any
subsidies.
Only 30% of people are aware that you can get financial aid
to buy one of these Obamacare plans.
I've been doing this for years and I still trip over new stuff.
Because the plans change every year.
Since there are many different plans with a range of costs and
benefits on the marketplace. The government bases the subsidies
on the price of what is called a benchmark plan, which is
considered a mid level plan, cost wise. The subsidies are
determined on a sliding scale. People making under a certain
amount only have to pay a percentage of their income. As a
household income rises, the percentage of the required
contribution rises with it.
If you have very low income, the percentage you have to pay is
zero. So the premium tax credit will cover the whole thing.
The pandemic may be partly responsible for altering the
workforce dynamic. Covid has also spurred legislation to make
insurance plans more affordable for most Americans, which means
it may be the perfect time for folks to consider taking the
leap.
The American rescue plan that Congress passed at the beginning
of 2021 enhanced the marketplace subsidies made them better for
everybody and made them available no matter what your
income is.
Prior to the American Rescue Plan act, an individual could
only qualify for a tax credit if they made less than 400% of the
federal poverty level, which comes out to about $51,500 for
an unmarried person with no dependents. But if that same
person made $52,000, they would pay the full price premium. The
sharp line for qualifying is frequently called the subsidy
cliff. The subsidy Cliff impacts older Americans the most
especially in the middle income bracket. The American Rescue
Plan Act removed that cap making it so people who make more than
four times the poverty level qualify for the sliding scale
subsidy, basically making the subsidy Cliff disappear. The
legislation also changed the max a person would have to pay from
about 10% of their income to 8.5%. It's rare for people who
make above 600% of the poverty level which is around $77,000.
For an individual to qualify for a subsidy. KFF estimates that
the American rescue plan act increased the number of people
eligible for subsidized coverage from 18.1 million to 21.8
million people. But the subsidy enhancements are set to expire
at the end of 2022. The Build Back Better Act includes
provisions aimed to expand those subsidies. The Congressional
Budget Office estimates that 3.4 million Americans would get
coverage through the marketplace over the next decade if the
enhanced subsidies are kept in place. The Build Back Better act
has yet to pass the Senate as of January 2022, which means these
deals may not last.
If you find the perfect plan this year, you're going to have
to do this whole thing again at open enrollment and see if your
same plan is offered next year or if it's been changed. That's
allowed, insurers can make changes to their networks and to
their formularies into their premiums and their deductibles
every year so you are going to have to kind of stay on top of
this.
The Obamacare exchanges seem to be most people's simplest option
when it comes to finding a comprehensive plan. But there
are other options for entrepreneurs to explore. A
temporary solution for many workers is a program called
Cobra which gives anyone who worked at a company with at
least 20 employees the right to continue to pay for their
insurance plan after they leave. Workers are usually eligible to
stay on Cobra for up to 18 months. This option, however, is
expensive because the previous employer is no longer
subsidizing the insurance costs.
Cobra was definitely something I wish I could have just stayed
with. Because I love my previous insurance. I was used to all my
providers, I knew it was a network, it was just very
expensive. It was over three times the amount that I would
pay if I were just paying my portion of my husband's
insurance. Also it would have been really awkward to ask my
employer how much is Cobra: "I'm thinking of leaving my job, but
I'm not leaving yet. I need to see how much Cobra would be"
that would be an awkward conversation to have.
Neither Nicole nor Erica were eligible to receive a premium
tax credit for a plan from the marketplace. Nicole decided that
going on her husband's plan was the best financial option for
them. But it was still expensive, and it was difficult
to estimate how much she would end up paying in the end.
I think I guessed at my husband's potential insurance
would be from past forms he might have gotten. Because we
didn't know for sure how much anything costs until we paid it,
basically.
Erica also considered the option of going on her husband's plan.
It was so expensive for a family plan and it's just the two of us
that it was more economical for him to go on the insurance and
for me to figure out another option. When I first was looking
at health insurance I didn't even consider or didn't even
think of the option of having separate health coverage.
Erica considered plans with direct primary care providers.
These are essentially membership plans where patients pay a flat
fee directly to a healthcare provider and have no out of
pocket cost at time of service. These plans are not health
insurance. Instead it's paying upfront for a membership to
access primary care services throughout the year. The
downside of this option is that it doesn't typically cover
emergency services. Many direct primary care providers recommend
people who go this route also get a high deductible insurance
policy to cover emergencies.
That made me nervous because I just don't know, the only things
that I could find that actually covered emergency rooms were in
the health cost sharing option and the marketplace.
Erica ultimately decided to go with a cost sharing plan cost
sharing organizations, which are also called Health Care sharing
ministries are not insurance companies. This means they don't
have to follow the minimum coverage requirements that the
Affordable Care Act outlines sharing ministries are typically
a group of people who may share religion who pool funds and
agree to pay for one another's health care costs under certain
conditions.
They can exclude your pre existing condition. They can
charge you more just because they don't like the looks of
you. Or based on your age or based on your health or based on
whatever. There are no rules. Often if they're cheaper, it's
because you're not getting the same protection.
I am fairly healthy. So I feel like this is an okay thing for
me to take a chance on.
There are a lot of considerations to make when
choosing a health insurance plan. When you think about
affordability, think not just about the premium, but about the
additional costs you're going to pay out of pocket when you need
care. You almost never get 100% coverage. So if you are healthy
and you don't use a lot of care, you may find the marketplace is
way more affordable than what you're used to at work because
right it's on a sliding scale. If you're older, if you have a
significant health condition, you need to count more than just
the premium.
I feel like in America, we're in such like a rushing urgent
society. And I feel like with anything, any decision that
you're making any big change that you're making, allow
yourself the time and the grace and the space to really sit with
it. In order to feel comfortable with it. Don't feel like oh my
gosh, I'm going to leave my job. Give the resignation for two
weeks and not have a plan in place. Give yourself time to
like research your options, figure out what's best for you.
And don't feel like you have to rush