You are using an outdated browser.
Please upgrade your browser
and improve your visit to our site.
Skip Navigation

What Can Families Actually Afford?

Health care reform will succeed or fail based on how it affects people’s pocketbooks. But coverage of the health care debate has addressed this question too infrequently and too abstractly. That's why Marcy Wheeler's new post at FireDogLake is a genuine public service. In it, Wheeler breaks down, in simple and clear terms, how a family of four making around $66,000 a year (three times the poverty line) would fare under the bill that just passed the Senate.

You can question some of her assumptions, as Nate Silver does over at Five-Thirty-Eight. But the real question, as Silver also suggests, is what the figures actually mean.

Do they suggest we should pass this health care reform bill? Or do they suggest we should try to improve it?

The answer, I think, is both.

Wheeler focuses on a hypothetical family in four in Michigan, where she lives. She assumes they’re buying coverage on their own, through the new insurance exchanges, since that’s where reform will be having the most dramatic effects.

She starts with the barest essentials, drawing on government figures to assume $13,000 a year in transportation costs, $6,000 a year in child care, and so on. If you do the math that leaves around $7,000 for health care. But, even with subsidies, premiums alone will soak up most of that money--leaving a few hundred or, at most, a bit over $2,000 for out-of-pocket expenses. Wheeler concludes that “this family couldn’t even go through a normal childbirth without going into debt.”

That’s a pretty harsh conclusion--and, as Silver points out in his critique, probably too harsh. Wheeler’s estimates for housing costs seem pretty high and she doesn’t take account of several tax breaks to which this family would be entitled. Add up those numbers and the family is a bit better off than Wheeler allows, to the tune of a few thousand dollars. In most cases, that's probably enough to cover out-of-pocket expenses.

Still, this family is not going to have an easy time. Wheeler assumed zero spending on “non-essentials” like clothing, which is pretty unrealistic. And if this family has a member with a chronic disease, they're going to spend not hundreds but thousands of dollars in out-of-pocket expenses, year after year after year.

So how should a good progressive respond to this? It depends entirely on the question.

If the question is whether something like the Senate bill is worth passing and, yes, celebrating,* I remain convinced that the answer is an unambiguous “yes.” Without reform, this family would either be uninsured altogether or paying high premiums for coverage that is, most likely, far less comprehensive that what the Senate bill would guarantee them. The result, either way, could be the kind of medical bills that routinely drive people into bankruptcy--unless, of course, they decide to skip recommended medical care in order to avoid running up such debts.

But there’s a second question worth asking: Is this reform good enough? Here, I think, the answer is “no.” Families dealing with serious medical problems, particularly chronic diseases that require ongoing care, have enough problems without having to sweat out every penny. And even the best insurance policies leave people on the hook for expenses that fall outside of covered benefits and, as a result, don’t even count towards out-of-pocket limits.

Making those two arguments simultaneously is not easy. It's the political equivalent of walking and chewing gum at the same time. But if progressives can figure out a way to do it, the people that already stand to benefit from reform will benefit even more.

Update: I added the word "celebrating" after my initial post, as the item as a whole seemed more ambivalent than I intended. See what I mean about how hard it is to do these two things at once?

Follow Jonathan Cohn on Twitter: @jcohntnr