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Thoughts on Health Insurance for 2015

What you pay for health insurance is governed mostly by where you live.

Being self-employed I have the joy of buying for health insurance for myself. Aetna discontinued my current plan for 2015. Did I mention just how much I hated Aetna? Last week I used HealthCare.gov to check my options. The application starts with your ZIP code.

I started thinking: how different are health insurance prices between cities?

Short answer: up to 107% more.

The experiment

Which cities?

I picked nine cities for various reasons:

City Reason
Lancaster PA I live here
Austin TX
Brooklyn NY
Portland OR
San Francisco CA
Design/tech cities
Asheville NC
Boise ID
Friends and family
Salt Lake City UT I read their health costs were lowest in 2014
Miami FL Random geography

What persona?

I used a persona based on myself:

  • Individual plan
  • Excluded from income subsidy
  • 28 years old
  • Non-smoker
  • Non-parent
  • Not pregnant

Note: individuals earning over $46,680 are inelligible for subsidies. I saw the same plans/prices testing with $50k, $100k, and $500k income.

What pricing benchmark?

I want low premiums and high deductibles. Normal health care will never bust my out-of-pocket max, but any hospitalization probably will. Based on my age, fitness, and environment it’s a small risk that I have savings to back up.

Which plans?

My pricing benchmark meant either:

Catastrophic plans
Under 30 my health risks are minimal (aka indestructible).
Bronze plans
Over 30 some catastrophic plans are income restricted, so I might be forced into bronze plans for 2017.

Catastrophic plans

City Premium % Mean Deductible OOP Max
Asheville NC $156 +3% $6600 $6600
Austin TX $137 -9% $6600 $6600
Boise ID
Brooklyn NY $154 +2% $6600 $6600
Lancaster PA $107 -29% $6350 $6350
Miami FL $180 +19% $6600 $6600
Portland OR $128 -15% $6600 $6600
Salt Lake City UT $139 -8% $6600 $6600
San Francisco CA $208 +38% $6600 $6600
Mean $151 $6531 $6531

Bargain: -29% Lancaster, -15% Portland
Expensive: +38% San Francisco, +19% Miami

The out-of-pocket max for an individual in 2015 cannot exceed $6600. Only Lancaster had a plan under the max. Boise had no catastrophic plans for me (probably an income exclusion).

Bronze plans

State Premium % Mean Deductible OOP Max
Asheville NC $220 +13% $6275 $6400
Austin TX $165 -15% $6300 $6300
Boise ID $156 -20% $3950 $6350
Brooklyn NY $308 +58% $3000 $6350
Lancaster PA $167 -15% $4000 $6350
Miami FL $190 -3% $6500 $6500
Portland OR $149 -24% $5250 $5250
Salt Lake City UT $157 -20% $6300 $6300
San Francisco CA $245 +26% $4500 $6250
Mean $195 $5119 $6228

Bargain: -24% Portland, -20% Boise, -20% Salt Lake City
Expensive: +58% Brooklyn, +26% San Francisco

Only Portland had a significantly lower out-of-pocket max.

The results

  • Portland stands out in both tiers as a bargain.
  • Lancaster, Boise, and Salt Lake City are economical.
  • Brooklyn and San Francisco are crazy expensive — surprise.

Annual liability range

Comparing premiums vs premiums + OOP max these are the best/worst cities:

Catastrophic plans

  • $1284 min $7634 max in Lancaster
  • $2496 min $9096 max in San Francisco

Bronze plans

  • $1788 min $7038 max in Portland
  • $3696 min $10046 max in Brooklyn

In conclusion

Where you live may swing health care costs heavily:

  • +107% for using no health care.
  • +43% for using maximum health care.

What I’m actually paying

Lancaster is super affordable for me. My doctor is in-network, so I bought the $107/mo catastrophic plan. The next plan up was $145/mo with negligible benefit differences. I wager on staying healthy and pocketing the extra $456.

Compared to prior years:

Year Insurance Premium Deductible OOP Max
2013 Aetna
PPO High Deductible 3000 with HSA
$88 $3000 $3000
2014 Aetna
PPO High Deductible 3000 with HSA
$91 $3000 $3000
2015 Capital Blue Cross
Healthy Benefits Value HMO 6350
$107 $6350 $6350
  YOY Difference +17.5% +111.6% +111.6%

Switching from PPO to HMO should’ve been cheaper, but it wasn’t. That’s the cost of national healthcare reform.

On the bright side, it’s just me. Insuring a family is crazy expensive.

Discourse Gravitated