Dec 26 2012

the pastor and the bartender: $552.43

Original post at http://pastorandbartender.blogspot.com/2012/12/55243.html

Americans obviously have a lot of problems with personal finance.  We have, on average, astronomical credit card debt.  We frequently buy houses and cars we can't afford.  Even going to college or grad school is put on the tab - and I'm as guilty as the next person on this one.

One of the biggest root causes of all of this is that, in spite of being so materially focused, we are still reticent to discuss dollar amounts that we pay for things.  Somehow that is still considered impolite conversation!  Salaries are closely guarded secrets that we guess at.

I want to help break this taboo with some real talk on our family's budget.  When we moved to Nashville, I took a serious pay cut.  At the same time, we bought a house.  The mortgage and homeowners' insurance is about the same as what we were paying for rent and renters' insurance, but there are of course all the auxiliary costs that go with home ownership, plus we had decided to put on a house addition because the house we bought was quite small (~900 square feet).  Shortly after we signed on the house, my husband lost his full-time job.  The addition was already in motion - the foundation poured.

Jeff picked up some work, and we have been okay.  But things are definitely tight.  We are regularly spending every bit of what we make in a month, and not saving anything.  As a United Methodist clergyperson, I do have a pension which is automatically funded.  This is quite unusual anymore.  I have the option of adding to it out of my earnings, but haven't been doing that while we are in this position.

The figure I want to discuss today is what we pay monthly for health insurance for the three of us:  $552.43.  This is high, and let me explain why.  My husband has Crohn's disease, an autoimmune digestive disorder that needs special care, a regular gastroenterologist, frequent colonoscopies, sometimes hospitalization, medication during flareups, and very rarely, surgery.  It is expensive.  Insurance companies recognize this, and he is virtually uninsurable as an individual.  Thanks to some health care law changes, he is no longer allowed to be outright blocked by insurance carriers on account of his condition, but the price gouging is intense.  We definitely can't find anything close to the quality of insurance we need for him for less than $550 per month.

Thanks to the United Methodist organizational system, we have the opportunity to belong to a pool through the Tennessee Conference.  As a full-time elder under appointment, my insurance premiums are covered 100% by the conference.  Adding any adult + children dependents at all (whether it is your spouse, your spouse and your child, or your spouse and your ten children) is an additional $552.43.  And that is a cut rate.  Because my base salary is the minimum allowable for a full-time elder, I am eligible for a reduced rate on the monthly premium.  We could search for other, cheaper insurance for Vicki, but it wouldn't make any difference - we would still be paying the $552.43 just for Jeff.

But wait!  There's more.  The premiums are only what we pay for the privilege of paying more.  There is a $1000 deductible (total, for the whole family) for all services except well-child, and then we pay 20% for pretty much everything after that, up to $2000 per year (including deductible).  One colonoscopy pretty much wipes that out.  So we're looking at $552.43 per month plus $2000 per year.

One upside that I mentioned above is that the rate remains stable for a given year no matter how many dependents you have on your plan.  So, adding the new baby will not be very stressful, since it won't increase our premium at all.

Just the premiums represent about 18% of our pre-tax, total earnings.  In a year where we pay the maximum $2000 out of pocket, the total cost for health care would be 23% of earnings.  

Don't get me wrong.  I am so thankful we have this opportunity, because it is way better than the alternative:  paying out of pocket for all of this at full price.  That would literally break us.  Jeff would not receive the care he needs and deserves.  But when people try to pretend that health care in our nation is not messed up, it bothers me.  More than a little.  I don't know the right answer, but what we have isn't working.  At least not for people who are actually sick and need help.

So, are you brave enough to tell me what you pay for health care per month, or per year?  Is it working for you?

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