One of the big barriers in my mind of quiting my day job and going independent is that I'll be responsible for my own insurance, which is a cost I can't ignore.
To those of you that are independent, how much is your health insurance actually costing you?
Part of ACA is that insurance companies can no longer refuse coverage or charge more for pre-existing conditions. IMO the insurance companies agreed to this because everyone was going to be forced into either buying insurance or paying a penalty to be self-insured (not carry insurance). The penalty was later removed by Congress, but the insurance companies were stuck with the no pre-existing conditions rules.
https://www.hhs.gov/answers/health-insurance-reform/can-i-ge...
When I tried to get private insurance from major carriers, I ran into:
- circular phone trees that couldn't be escaped
- forwarding to "agents for my area" that never answered the phone
- forwarding to agents that did answer the phone but said there would be coverage limits for 6 months since I had a pre-existing condition. This is illegal. One agent did give me a quote for $2400/mo with a $10K deductible.
- I did find prices on the Internet that said private PPO coverage would cost about $800/mo with a $10K deductible, but no insurance company would actually write it.
IMO, only writing new individual coverage (not via company employment) during open enrollment is a way for the insurance companies to keep their limit on pre-existing conditions.
I ended up paying cash ($12K) for a 1-week visit to Mayo. In hindsight, paying cash was a better deal than if I had private PPO coverage: PPO would have cost $9600 in premiums (or more!) plus I would have paid the first $10K, so nearly $20K.
Insurance in the US is a mess!
I do have to add though, ACA has been a lifesaver for me.
I would figure out how much your current health insurance is (both the employee and employer contribution). This is the amount you would pay if you quit your job and went on COBRA. You can be on COBRA for 18 months and it's typically cheaper than finding an equivalent plan on the marketplace. That gives you time to grow your business and figure out a long term health insurance solution.
I could get reasonable short term plans for about a quarter of that. As a healthy individual that was definitely the right choice for me, but if you have high utilization already it might not be for you.
But... it's not "expensive"... It's just the price. And many people never see or think about it because "employer" pays some/most/all of it. Until... you don't have an employer. Then it seems "expensive". But... the price has always been there, we just don't see it sometimes.
Employer-involved insurance is one of the biggest things slowing social progress, imo.
We're in our mid-30s, healthy (run marathons), non-smokers, with no prescriptions. Not having insurance means carrying the risk of going bankrupt after one unlucky event.
1) are these amounts tax deductible?
2) given the size of these amounts, OP’s statement that these are a big barrier to going independent would seem totally reasonable. Doesn’t this have a chilling effect on new business formation? If so, how is the US still so well known for startups? It seems significantly riskier than in other countries with better safety nets.
So... you have a job, but there's no employer-provided health insurance. You make $60k/year. Your adjusted income (after some deductions) might be, say, $45k. You decide to buy your own health insurance, and it costs you $500/month. That's $6k/year. 7% of $45k is $3150. So... $6000-$3150 = $2850 which would be the amount that you could avoid paying taxes on.
Confusing much?
> If so, how is the US still so well known for startups?
Because there's metric-ass-loads* of money here looking for places to be invested, and we idolize the unicorn homeruns so much so that we have entire industries catering to their ecosystem.
* Note, this is one of the few times we use the metric system in the US. 2 liters of coke/pepsi, and metric-ass-loads of <fill-in-the-blank>.
2. I believe it does and I can’t answer the other question with any confidence. Insurance was a big reason my mother kept her job which covered us as a family when my dad started his own business even though she was basically working two jobs because she was also helping with the new business after work.
1) Given the size of these amounts, why aren't you all marching on Washington with pitchforks? Your healthcare system is INSANE.
$10k in premiums going away with taxes going up $5k is heavily portrayed as a "tax hike" when universal healthcare is discussed.
keep in mind that PPOs for independents aren’t the same as PPOs for companies even though the appear to be.
let’s say you have blue cross blue shield PPO with your current employer it’s not the same even on the platinum level blue cross blue shield PPO.
fewer doctors in network. lots of mini surprises await you if you actually use it.
that’s such bs.
in a way i was personally better of prior to ACA since i could get insurance for $150/month. yes it’s nice that i can’t be disqualified due to pre existing conditions but it isn’t the meca it’s claimed to be.
Moving back to Australia looks better every year.