The hard truth about Obamacare and the working poor [Financial Friday$]

With the deadline for Obamacare (the “Affordable” Care Act), we’ve been getting lots of calls from our fellow working poor individuals about what to do. The truth of the matter is, most of us a stuck between a rock and a hard place. As working poor members of society, we make just enough money to stay off government aid, but not enough to afford anything. Our personal budgets are a very fine line indeed. Many of us can’t afford the government health care, nor can we afford the health care offered by our day jobs without sacrificing something important, like food or a good home. Some of live in states where there is a gap of coverage between the Medicaid and who can actually afford health care. Others have found that they can not qualify for Medicaid, nor are they old enough for Medicare. 

Sadly, there aren’t any good options.

Here is what we’ve been told by our State Representatives here in Indiana:

From Christina Hale, Democrat
  • Move to a different state that covers the gap
  • Make less money
  • Write angry letters or call your other representatives
From Susan Brooks, Republican
  • There aren’t any good options, but you can try for Medicaid. They are expanding to cover some of the gap. Single parents with children take precedence, followed by others that are in desperate need of government aid.
  • The fine is only $93, which will come out of next year’s tax return — or 1% of your income, whichever is higher. Take the hit the first year, then try to get into Medicaid again. We will be expanding it again if there is greater need.
  • Try to see if you can qualify for a lower bracket on the site, you may or you may not.
  • Apply for hardship exemption. You may be able to get exemption.

As you can see, the advice was quite diverse depending on who was talking. We assume that the advice is similar no matter what state you are in; representatives won’t talk to people outside their area, so we can’t be sure.

It’s true, though. If you do not have coverage, you will get fined for not being in compliance. 

So, your first step no matter what is to file for the hardship exemption.

So what now?

The deadline is looming just a few days away, and like most people, you’ve probably been swinging back and forth on what you should do for next year. Here is the advice I have given to my friends, family, and colleagues. However, I am not a lawyer. I’m a bookkeeper with stellar accounting skills. I am not licensed to give legal advice. That said, take the advice or leave it. Either way, know you are not alone in the struggle that the government has put us in.

Young, healthy adults without kids

Step 1: Decide if you actually need health care. Young, healthy adults without kids are fairly good without full coverage. What they need is the equivalent of a spend account for minor things — which the government has done away with. However, take a look at the lowest tier of health care from multiple providers to get the best price for what you’re getting. To be honest with you, none of what they offer on the Marketplace is a good deal for young adults. I can’t see any young adult paying that much money for what they are getting. At our economic level, it’s a good waste of money when going to Urgent Care is cheaper.

Step 2: This step assumes you are a young, healthy adult without kids. Start a health care savings account for those “what if” times. Make sure you contribute to it every week, even if it’s just a small amount. Each Urgent Care visit is ~$100 – 200 depending on city and tax rates. You’ll pay more for any tests or medication that’s needed. However, this is your health care plan and peace of mind that if you need the money to get healthy, it’s there waiting. I’d recommend having at least $500 in savings. This is a low cushion that will provide for a single illness where you must have lab tests done and get medication. It will NOT provide for broken bones, stitches, or other emergencies. For that, have at least $1000 in your savings.

Everyone else

Step 1: Decide which package you actually need. Kids, people with health issues, and older people should really take advantage of health care now that they can’t deny you for pre-existing conditions (or in the case of kids being self-destructive chaos machines). Take a look at the lowest tier of health care from multiple providers to get the best price for what you’re getting. From what I’ve seen, private health care is still a better deal than the Marketplace. You might pay the same price or a little more, but you get a lot more for what you’re paying.

Step 2: Take a hard look at your finances. Can you seriously cut anything out? Are you living with non-essentials? Going shopping every weekend? Cut out what you don’t need, and see if you can’t “find” the money to pay for health care. Remember, it’s often worth it to have good health care — especially if you’re older or have accident prone kids. If you can “find” money by cutting out non-essentials, I highly recommend getting the best health care you can afford. (Often this is not public heath care, either.) If this isn’t an option, move on to step 3, if it is, great! Get coverage.

Step 3: Assuming that you couldn’t find the money by cutting out non-essentials, suck it up and take the hit for this year. It sounds mean, I know, but that is your best option. The fine will be small the first year. Now, take a deep breath and start over from the top. Look at your choices and your finances.

Step 4: Starting now think ahead. For most people it’s going to take a lot of creative legwork on making more money to cover this extra cost. Get a freelance job, such as working with us or any number of other places you can find by searching “____ freelance jobs”. Just fill in the blank with your skill set, and off you go. Work these sorts of jobs at least once a week, then save the money to get ahead for next year.

Step 4 (alternate): Find another job that pays more or offers health care coverage.

Step 5: Write your congress representatives often to explain the situation to them. They won’t know what’s going on under their jurisdiction if you don’t stand up for yourself. Tell them what you want, whether that be real affordable health care or something else.

Step 6: Don’t give up, and don’t let them get to you. We know it’s hard, but you’re not alone. There are many of us out here that are fighting for better coverage at a better price. Don’t settle for less. After all, we still live in a capitalist economy within a democracy. It is our right to fight for a better price for what we’re getting, and it’s also our right to vote out those that would keep us down. There is always next year.

In short…

The short of the matter is that health care is wonderful, if you can actually afford it. However, it is not worth giving up other necessities, such as food, a safe place to live, or electricity. The only things you should give up for health care are those things you can live without. Your health is worth it. Just remember to get the best deal possible, even if that means working extra hard to save up for emergencies on your own.

In the mean time, file for the hardship exemption, then do whatever you can to stay healthy. We’ll get through this.

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