April 2014

Affordable Care Act Unaffordable to Some San Franciscans

Morgane Byloos

This month marked the deadline to secure health insurance under the Affordable Care Act, with many low-income families gaining access to health care insurance for the first time. But despite its name, the national mandate is coming at a high cost to some San Franciscans, who make more than the maximum allowable yearly income, and as a result don’t qualify for subsidies and tax credits.

Before the Affordable Care Act went into effect, an individual plan cost $196 a month on average in California. That same health coverage plan now costs $331, according to a report by eHealth, a Mountain View-based company that’s the nation’s largest online heath broker.

Under the Act there are four ways for people to get insured: from their employer; through a government agency that caters to low-income individuals and families, such as Medi-Cal, which expanded access as a result of Obamacare; through Covered California, the newly created health care pool; or by buying directly from an insurance company or through a broker.

Bradley Vaccaro, president of Dogpatch-based Allpointe Insurance Services, said he encouraged people who make 400 percent or more of the federal poverty level to stay away from Covered California, as they will not qualify for subsidies. In 2014 the federal poverty line for a one-person household in the 48 contiguous states and the District of Columbia is $11,670, which translates into a roughly $48,000 annual income limit under the Act. “Overall, the experience is that the middle-class people are making too much in income to qualify for tax credit,” Vaccaro said.

Andrea Dance, a 53-year-old court reporter who lives in Potrero Hill, is concerned that Obamacare may create more problems than it solves for her and her 15-year-old daughter. “Conceptually, I believe in Obamacare, and I truly believe that everyone should have insurance. But I’m feeling really squeezed,” Dance said. “In a sense it’s worse because now we’re forced into having insurance; we don’t qualify for any subsidies but our premiums have gone up again.”

Dance didn’t figure out which option to choose for her family until the enrollment deadline was less than a month away. She found the process frustrating, because she thinks her lifestyle doesn’t require comprehensive health coverage. “In my entire life I have been in the hospital three times,” she said. “Once at 15 for an emergency appendectomy, once at 38 to have my daughter, and one emergency visit in 2012 for what turned out to be diverticulitis. I don’t smoke. I drink moderately. I walk three to five miles, four to six times a week. I laugh a lot. We cook almost all of our meals the slow food way.”

Dance believes she’s paying too much for insurance, and that her deductible is too high. “I seldom go to doctors because I don’t feel the need to and, even though my premiums are high, and just went up to over $600 a month, my deductible is also high, so I figure most things will clear up on their own. If not, then I’ll go. I had to pay my $10,000 emergency bill out-of-pocket because I had not met my deductible because it’s so high, so I’m paying $167 a month for four years. My daughter is on her own policy, but under me, and her premium just went up by 24 percent too. So between the two of us I’m paying close to $900 a month. Which, of course, means I have no savings, no retirement, no vacations. But I do have health insurance.”

According to Vaccaro, only 20 percent of his clients are benefitting from Obamacare financially. But he said his customers generally believe that Obamacare is a good thing because anyone can now get healthcare regardless of pre-existing conditions. Vaccaro said he thinks the health care system is going in the right direction but that there’s room for improvement. “It’s going to be bumpy this year because everyone is figuring things out. Although there have been efforts made to inform people of what their options are, there are a lot of people who felt misinformed,” he said.

According to Dance, San Francisco officials could have established satellite offices, similar to precinct-based voting stations, where people could drop in and pick up forms and information “I’m thinking there is probably a lot of misinformation out there,” she said.

District 10 Supervisor Malia Cohen said she’s helped ensure that people who wanted health insurance enrolled in Covered California. “I am proud to say that I have been an early supporter of the roll-out, and I have personally hosted two education and enrollment events in District 10: one in August and one in October. Beyond that I have also worked with local churches and other places of worship, connecting them and their membership to official Covered California educators and enrollers to increase awareness and enrollment in District 10.”

According to Cohen, as District 10 supervisor she represents a majority of San Franciscans who are at 138 percent of the federal poverty level, and who were previously enrolled in Healthy San Francisco. That program offered health care services to San Franciscans regardless of their immigration and employment status or pre-existing conditions. “Because of the Medi-Cal expansion, U.S. citizens and certain legal immigrants that are between the ages of 19 and 64, or have a family income level at or below the federal poverty level of 138 percent that are enrolled in Healthy San Francisco, became eligible for Medi-Cal and Covered California on January 1.”

Cohen said that one of the best things about Covered California is that it’s available to all income levels, not just low-income individuals. “I intend to do what I can to ensure that the neighbors that I represent in Potrero Hill, Visitacion Valley, and Bayview are able to take advantage of Covered California.”

People who don’t have coverage starting this month will be fined when they file their 2015 income taxes, a penalty that will increase over time.

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