Is Cheap Health Insurance Worth It? Pros vs. Cons
Meredith Miller | Published: June 14, 2018
Healthcare is an expensive but necessary requirement, but not many unemployed people can afford health insurance. Luckily, the Affordable Care Act [ACA] also known as Obamacare aimed to save the day in 2010 despite the controversial debates regarding its implementation. This plan expands healthcare access to many people who would otherwise not afford such services and regulate the growth of healthcare expenditure in the country. In response to the ongoing debate of whether cheap healthcare is worth it or not, here are the pros and cons so that people can make informed decisions.
Pros of Cheap Health Insurance
1. You are Covered
The number one benefit of this healthcare plan is that it covers pre-existing health conditions like cancer, diabetes, HIV, and others. Most private health insurance companies do not include pre-existing conditions because they are expensive in terms of medication and specialized care but also because of the prolonged period of treatment required.
2. Subsidized Coverage
ACA also has extended health insurance to a large number of people who could not afford such luxuries before. Young adults under the age of 26 will be included under their parent’s plans, and impoverished people are now considered as well because of subsidies. Companies are also now being required to provide health coverage to their full-time employees. This means that cheap health insurance options provide more coverage.
Affordable health insurance lowers the cost of healthcare significantly by offering free preventative care. Most people wait until they are very sick so they are taken to the emergency room and spend a lot of money while annual screening could prevent such occurrences. Cheap health insurance plans prefer you get regular check-ups to make sure they don't incur larger costs down the line.
ACA also requires all insurance companies to cover ten essential health benefits that include mental health, addiction, and chronic diseases. These are conditions that were not covered before the implementation of Obama care and many people ended up in the emergency room as a result. The costs of these benefits are passes onto Medicaid.
Insurance companies are no longer allowed to deny any applicant coverage no matter their financial status or health condition. They cannot drop patients on a technicality as they did before or raise premiums just because someone got too sick. The principle behind Affordable Care Act is protecting people from being taken advantage of by insurance companies.
Cons of Cheap Health Insurance
1. Tax Penalties
The number one disadvantage according to many people is the risk of paying penalty taxes if you don’t purchase a qualified health insurance plan. This move, of course, was implemented to make people buy health insurance, but some people argue that not everyone wants to be covered.
Whether or not you are using your health insurance to cover medical costs, you are still paying premiums. This means you spend money each month to stay on your plan regardless of if you require medical attention.
3. Limited Network
ACA limits enrollees to a narrow network of medical practitioners so you can’t just go to any healthcare provider and expect the insurance to pay for you. You have to choose a doctor or a hospital from the list provided and if you want a healthcare provider from any of the high-end clinics you have to pay out of your pocket.
4. High Out-of-Pocket Costs
Almost all health insurance plans follow this logic. If you pay high premiums, you will have lower out-of-pocket expenses, and vice versa. This means if you are paying a low monthly premium, you will probably have a higher deductible. So if you're only paying $100 monthly towards your policy, then you're health coverage may not kick to cover your medical expenses until after large payments are made.
5. Small Window
If you qualify for a subsidy and rely on it to afford health coverage, then you have a small window to purchase. Each year there is an Open Enrollment period that allows you to shop for insurance through the government's health insurance marketplace, so make sure you don't miss it.
There is no doubt that the Affordable Care Act has brought with it many advantages despite the few downsides. Whether affordable insurance will remain with the current regime fighting so hard to get rid of it is still a mystery, but people should stay prepared for any eventuality and get their finances in order.