Uninsured family weighs whether to sign up

The family of three would like to have coverage, but it’s too expensive, they say. Cindy Benequista lost her job as a catering manager earlier this year and is now starting her own business as an event planner. Her husband, Daniel, is a sales manager and works on commission. The couple has one child, Joseph, who is 14.

“Since my husband works on commission, there is a risk of no paychecks. Once we sign up for an insurance plan, we are locked in and that’s tough when you have a bad or mediocre month,” Cindy said. “We could literally end up in the hole.”

The family looked into private plans, and they were not feasible, Cindy said. The cheapest plan she could find was $600 a month with a $10,000 deductible.

“We have minimal expendable income, and I know a lot of people are in the same boat,” she said.

The family’s monthly expenses include rent and one car payment. They have no credit cards.

“Health insurance has never been a fun thing for me. When I had back surgery I had insurance but still had to pay some of the bill,” she said.

The deductible for her hospital stay was $2,000, which Cindy’s mom paid. More bills followed the surgery, and Cindy is still paying them off.

Starting Oct. 1, the Benequistas and other uninsured Arizonans will be able to pre-enroll for health insurance that will begin Jan. 1 via Arizona’s health insurance marketplace, which is operated by the federal government at www.healthcare.gov. As long as Cindy and Daniel’s annual income doesn’t total more than $78,120, they’ll be eligible for a subsidy to offset the cost of their premiums.

According to the Kaiser Family Foundation’s subsidy calculator, a silver level plan for a family of three with a household income of $39,000 would cost roughly $215 per month. That takes into account a federal subsidy of about $5,000, or 6.5 percent of the family’s income.

If the family’s income were to jump to $50,000, the monthly premiums would be about $342 on average, the Kaiser calculator estimates. At $78,000 the monthly charge would be about $618.

Depending on their income, some families will also be eligible for cost-sharing reductions related to out-of-pocket costs such as copays and deductibles through the marketplace.

When she had employer-sponsored insurance, Cindy was paying $546 a month for just two people — her and her son.

“That seems better,” she said of the subsidized rates. “Though not that much.”

If the Benequistas overestimate their income when buying insurance, they will be able to report that to the marketplace and have their payments adjusted.

If they opt not to buy insurance, they will be subject to a fine of 1 percent of their income or $95, whichever is greater. For an income of $50,000, that would equal a fine of $500. The fines will go up each year after 2014.

Cindy says she’s heard a lot of talk about the new law and has been trying to find the real facts.

“With social media, the rumors and nonfacts spread like wildfire,” she said. “There are people who are horribly against Obamacare. They say more people will be (working) part time instead of full time.”

Indeed, the notion that businesses are cutting workers’ hours because of the health law is a common one.

But large businesses are not required to provide health insurance to their employees until 2015, and small-business owners don’t have to provide it at all, said David Sayen, administrator of the U.S. Centers for Medicare and Medicaid Services region that includes Arizona.

“Given that the employers aren’t on the hook for the penalty until 2015, the tax year that ends in April of 2016, why would they drop people because of the health law? There’s no reason that would be true.”

Sayan says the law may actually result in people willingly reducing their hours because they can get affordable, comprehensive insurance through the marketplace and therefore don’t need to rely on full-time work with an employer.