Why are health premiums and deductibles so high?

Out-of-pocket costs, the GOP’s rejection of Medicaid, the family glitch, and premium increases. These are ObamaCare’s sticking points.

What are Sticking Points?: Problem areas. Obstacles to progress toward an agreement or goal.

TIP: I’d also add issues with traveling out of country paired with the mandate, the mandate itself, requirements for very small businesses regarding HRAs, and a few more odds and ends to the list. Feel free to ask questions or comment below.

Out-of-Pocket Costs

The facts:  In 2016, your out-of-pocket maximum can be no more than $6,850 for an individual plan and $13,700 for a family plan before marketplace subsidies.

The problem: Even with cost sharing reduction subsidies this is not affordable. Do you know a family who can afford another $13,700 a year? Not saying I know a Government or tax payer who can, just that I don’t know a family who can either. But this isn’t me telling you, this is me telling you what everyone has been telling me for the past two years.

The solution: The government can subsidized, regulate, and tax. I think we have all had just about enough taxes. Subsidies mean taxes or debt. So, can we think of any super profitable industries that might need regulating?

Not the solution: Repeal the ACA and focus on letting the free market work itself out.

The bottom line: We likely need to, yet again, regulate the industry from the ground up to avoid personal and national debt. HealthCare creates a ton of jobs and wealth, so good luck with that one.

Rejecting Medicaid

The facts: A lawsuit backed by the right had the NFIB take the ACA to court. During this 2012 case they gutted Medicaid expansion letting states opt-out. State’s opted-out tactfully leaving this poorest to believe Obama(care) was the problem. They cited cost as an issue. Sure it is a bit, but this is basically political spin to push back against Obama.

The problem: Medicaid is actually expensive, so there isn’t a simple solution. Still, the 5 million-ish (often working poor Americans) are going without healthcare as politicians stuff bills full of pork and the inequality gap in America widens. These 5 million are essentially being used as pawns in a political game and we are all a little worse off in our souls for it.

The solution: Expand Medicaid. Or maybe even expand Medicaid to all and let the private market take care of supplemental coverage. Medicaid for all, it’s not Medicare for all, so you didn’t already say no.

Not the solution: Repeal the ACA and focus on letting the free market work itself out.

The bottom line: Just stop with the politics and offer catastrophic coverage to all citizens who can’t afford to pay into the health insurance system. With great power comes great responsibility, really it does.

The Family Glitch

The facts: There are no rules for how much employer offered spousal or family coverage can cost. There are rules that say you can’t get cost assistance unless an employer offers coverage that costs more than 9.5% of MAGI per person.

The problem: Asking each household member to pay 10% of their income in health insurance premiums (never mind out-of-pocket costs) IS INSANE. How did this even make it past 2014? Isn’t someone supposed to care about working families and small businesses?

The solution: Generally the same rules should apply inside and outside the workplace for insurance costs. Coordinating that isn’t simple, but there are a few ways this could work. It’s very important and feels like it’s been all but ignored. Where are you now NFIB?

Not the solution: Repeal the ACA and focus on letting the free market work itself out.

The bottom line: Working American families are overpaying and that means employers are overpaying. Remind me who benefits from this again?

Premium Increases

The facts: Premiums were rising faster than inflation. ACA curbed that a bit in the long-term, but the short-term is brutal. Insurers are losing money, Americans are losing money, America is losing money? Wait again who is making money?

The problem: No one can afford the premiums without assistance. We can offer assistance to people, but we can’t offer assistance to America (because we are America). We can’t go into un-payable debt over healthcare.

The solution: We have to look at why costs are high, not how we can subsidize and tax away the costs. Look at the budget. Health care isn’t and shouldn’t be free, but it can’t be unaffordable.

Not the solution: Repeal the ACA and focus on letting the free market work itself out.

The bottom line: A single payer system that offers catastrophic coverage. Catastrophic drugs and treatments are price controlled, litigation and billing is dealt with, the system is simplified. We let the private market handle supplemental coverage. This lets the strong healthcare players survive and generally takes the burden of propping up the system off the average American.


We don’t need to repeal the ACA, that is like an answer a child would give. We just replace tax credits, medicaid, and medicare with a single payer catastrophic coverage, keep HSAs and fund them with tax credits, give the new CMS/HHS more power to advocate on behalf of the people, and cut out a lot of the middle-manning we can no longer afford. We do so in a way that isn’t death by taxes or death by over-regulation.

Healthcare is one of the big three when it comes to spending. We don’t have to figure out this whole thing too many times. But sooner or later, actually this will simply be the next presidency, someone is going to just have to rip the bandaid off and get it right.

From the comments on this site I get the feeling there is only so many times you can choose corporations over people before people start giving up. We don’t want people giving up. Right?

TIP: See our page on “a fix for the ACA” for more ideas on how to fix what isn’t working.

What do you think?

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Mike on

I think you are full of Sh#(*#!

Wanda Hobbs on

I think you’re right! We need to regulate costs and cut out the greedy middlemen!


I am a firm believer in HR 676. Single payer is the best way to address Healthcare in this country.

Dave on

“We need to, yet again, regulate the industry from the ground up to avoid personal and national debt.”

You clearly don’t know what you are talking about. For all the detail you know about the ACA, you know nothing about economics. Your website is a joke, and this page proves the lunacy of ACA supporters.

Single payer? Wait, the government screwed up Obamacare, so “not the solution” is to pull the government back from having people pay for the consequences of their health habits, and expand government again – surely this will ‘avoid national debt’! Just like Obamacare will ‘bend the cost curve down’, right? The past couple of weeks must have been a nightmare for you – but what’s worse is that millions of people are truly suffering because of this insane bit of law that you and your liberal buddies foisted on the middle class. Once again, liberals have found a new way to screw the middle class – sadly now the country will elect Trump in a backlash election. Thanks a lot, liberals! Trump really is YOUR FAULT – not Republicans. We tried to put up a sane candidate but the insanity of 8 years of Obama has turned the country against reason!

The insurance companies are done subsidizing losses in Obamacare, so all hell is about to begin breaking loose in the healthcare industry, starting with insurance premiums, which Obama unwisely claimed would be lower as a result of his stupid health care bill. Based on what? More regulation? New taxes? More Medicaid? The 80/20 rule? All of those things make health care MORE EXPENSIVE, you idiots!!!!

It used to be that you couldn’t trust liberals with national defense and the economy. Obama just added health care to that list. Good luck trying to hold back the backlash tide with your ‘facts’. You’re playing to a smaller and smaller crowd every day, and the ACA’s days are numbered. Even Clinton wants to change it – shows how bad the bill really is…

Fleming on

It is very disappointing to me that leading up to open enrollment, all the news articles were about the big premium increases that were coming (and came). Even Bill Clinton helped bring the subject to light. Once Trump was elected, the articles immediately pivoted to how millions of Americans will lose their insurance if “Obamacare” is repealed. It’s all spin and hog wash. Look at how often you see the stat that 85% on the exchange get some subsidy, which is simply because nobody else wants to deal with the government if they don’t get a subsidy anyway. You also often see the statement that these out-of-control premiums only affect a “small” number of people. They never mention that there are as many people buying insurance on the individual market off exchange as on exchange. The result is that about 12 million people don’t get a subsidy but pay very high rates (or lose their coverage because they can’t afford it like my family) now so 8 million on exchange get a subsidy that is often tiny. The articles like to say the premiums went up 22% on average. Ours went up 75%. Then they say this is a “one time correction.” Then it’s a correction to an amount we will never afford. In summary, we make more than the about $78k (400% of poverty) ceiling to get a subsidy for our small family but far less than the $104k that represents the income for which the cheapest bronze plan in our county is 8.13%. In other words, by the ACA’s own rules, it’s “unaffordable”, and we won’t have to pay the tax penalty. The problem is we need/want health insurance, so we got a temporary policy for now. The funny thing is that with the temp policy, we can go see all the doctors that were in our PPO that we lost with Obamacare plans. True, there is a $1M max payout/limit for the insurance company, but this is by far the better solution for us right now. It costs one third of the exchange plans price. The fact is people need many different products and options so they can choose what is best for their family instead of being shoe-horned into any one system. It makes sense that when a person or family has sickness, health care and insurance will naturally become a priority in their lives at that point and onward, but young and healthy people that are trying to build a life for themselves don’t want to and can’t afford to pay 8% of their income for this whether it is by over-regulated Obamacare premiums or single-payer system over taxation. I am totally in favor of people being able to get insurance with pre-existing conditions perhaps with some time frame guidelines to make it work as well as some amount of tax credits and even refundable credits and also a low-end public option for really sick and poor people. And finally, the “tweaks” promised by Democrats would not nearly bring this inline with something reasonable. I’m tired of the hubris of any party promising me a better dinner and then making excuses and pointing fingers in the face of the disaster and dusting off their hands and walking away and sticking me with bologna. If your sick, bologna is better than nothing, but it makes no sense for everybody to have accept bologna.

MJ on

Universal catastrophic and physician access coverage is what you get under systems such as Canada’s. This comprises 70% of total healthcare dollars as a “tax” or single payer if you will. Private insurance covers dental, optometrist, drugs, long term care along with sundry goodies like private beds in hospitals. This is the other 30% of the cost which is user pay. The major benefit to all is that if you get REALLY SICK you will get immediate world class treatment without bankruptcy as a side effect.
Industry lobbyists have bought and paid for the entire US Congress over the last 30 years to solidify their monopolies and if you think they are going to give up their $3 trillion dollar racket think again. Clear thinking will bring you to the realization that O’care was the master codification of this butchery. Ditch the political bias and understand that this laughing stock of a system was deliberately constructed by both sides equally. Since Trump is neither maybe he can bring some honest analysis to all this. Maybe not.

MachineGhost on

> This lets the strong healthcare players survive and generally takes the burden of propping
> up the system off the average American.

No it doesn’t. It just cost shifts from upfront premiums to backloaded taxes. Look at Canada’s Medicare-For-All. It’s already insolvent and they’ve had to resort to allowing private insurance to help improve efficiency and lower costs.

ObamaCareFacts.com on

Interesting take. Certainly we, being intelligent humans, can figure out a system that is both moral and functional. I am with you though, shifting costs is not in itself the perfect answer. I think this could help solve some of the problem though: http://obamacarefacts.com/2016/11/21/nationwide-non-profit-public-health-network/

That is, public option plus a nationwide public network. There you are having people pay in now (not on their taxes) and pairing that with non-profit (which is private market, but non-profit).