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Dan Calabrese Doesn’t Do His Homework About Obamacare, and It Shows

Screw Obamacare proclaimed the headline to Dan Calabrese’s editorial on Herman Cain’s website last week. Directly following his bold statement of civil disobedience were the words: "Why I’m leaning toward staying uninsured (and many of you should do the same)." Calabrese’s title is quite misleading since his argument is not “Screw Obamacare,” but instead, “Screw Health Insurance.”

Calabrese makes a lucid and logical argument against buying comprehensive health coverage for he, his wife, and 13-year old son, all of whom he states are “healthy and we do not consume a lot of health care services.” He reasoning is sound, and provides a simple financial analysis to support his decision:

We could purchase the type of family coverage that a lot of people typically get through their employers, but coverage that comprehensive would cost us at least $400 a month, which means we would almost certainly pay close to $5,000 a year for a third party to pay our medical bills. Simply paying out of pocket, we spent less than $2,000 over the course of the past year. Why would I want to spend an additional $3,000 for nothing?
However, his math gets a little fuzzy when he admits that he is indeed shopping for health insurance to cover possible catastrophic circumstances. A policy in which he would prefer an annual deductible of $27,000. For this catastrophic coverage, he expects to pay less than $200 a month. So let’s put his monthly premium for catastrophic coverage at well under $200, let’s say $150 per month, or $1800 a year.

All of sudden his savings for not buying comprehensive coverage has fallen from $3000, to just $1200 a year. About to turn 47, Mr. Calabrese is closely approaching the age of 50, when incurring an additional $1200 a year in health care is not just likely, but almost inevitable. If, when he turns 50, he undergoes a colonoscopy, as recommended, that $2400 procedure alone will put him in the hole by $1200.(1)

But Mr. Calabrese has an answer for not even buying catastrophic insurance:

But thanks to government policy, I'm not sure that's a rational decision either. First, we live in Michigan, where the state's mandatory no-fault auto insurance includes unlimited lifetime benefits if you are injured in an auto accident. So if the catastrophic situation were to occur in that manner, we're already covered. Of course, it could happen in other ways. I could fall off my bike. A tree branch could fall on me. I could get cancer. Stuff could happen. But since ObamaCare bans insurance companies from denying you coverage in the event of a pre-existing condition, why get the coverage now? If something happens, I can always just front the first $27,000 and get the high-deductible coverage for whatever comes after that. They can't deny me, right?
Seems so easy, right? Just wait until something happens, then waltz into an insurance company office and demand immediate insurance for any calamity you have been stricken with. But even under Obamacare, it’s not that easy. But Mr. Calabrese hasn’t done his homework, and it shows. Under the “government policy,” he speaks of, catastrophic health plans will not be available to people over age 30.(2)

Mr. Calabrese is right that he will be guaranteed insurance under Obamacare, and it will actually be far better, and cheaper than shelling out the first $27,000 every year.

But here’s the rub: in both the Obamacare exchanges and the private market outside the exchanges, there will be “open enrollment” periods, likely between October 15, and December 31. Similar to how employer group plans now operate. So if Mr. Calabrese, or any member of his family suffers a medical calamity in June, he cannot purchase insurance at that time, he’ll have to wait until October 15, and then the coverage will likely not start until January 1.

But in a pure mathematical sense, Mr. Calabrese will most likely not be faced with a medical calamity. The odds are in his favor. But we do know that if even a small percentage of the American public take the advice of Mr. Calabrese and his ilk, thousands, and ten of thousands of families face financial devastation.

If just a million couples decide to not purchase health insurance, the stats are pretty clear. Of those in their 40’s, 14,500 women will get breast cancer, and 3,400 men will get prostrate cancer. In their 50’s, over 23,000 women will suffer from breast cancer, and the same number of men from prostrate cancer. (3)

65,000 uninsured people with cancer. That would be the result of Mr. Calabrese’s ridiculous advice.

This story relates to Dan Calabrese’s Editorial at Caintv.com:
http://www.caintv.com/...

References:

(1)  Detriot, MI: Colonoscopy Cost Comparison http://www.newchoicehealth.com/...

(2)  Federal Register/Vol. 77, No. 227/Monday,November 26, 2012/Proposed Rules
http://www.gpo.gov/...

(3)  Centers for Disease Control and Prevention
http://www.cdc.gov/...

Originally posted to Politics and A Beer on Thu Sep 26, 2013 at 11:07 AM PDT.

Also republished by Community Spotlight.

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Comment Preferences

  •  Colonoscopies are a free screening procedure (1+ / 0-)
    Recommended by:
    nirbama

    under the ACA.

    We are the principled ones, remember? We don't get to use the black hats' tricks even when it would benefit us. Political Compass: -6.88, -6.41

    by bmcphail on Thu Sep 26, 2013 at 12:26:11 PM PDT

    •  Hmm. (0+ / 0-)

      Out of this entire diary, wherein the diarist gives the cost of a colonoscopy without ACA insurance, your comment is that colonoscopies are free under ACA. Hmm. Okay.

      •  Yes, that's where I chose (0+ / 0-)

        to make a small contribution to the discussion. What's the problem?

        We are the principled ones, remember? We don't get to use the black hats' tricks even when it would benefit us. Political Compass: -6.88, -6.41

        by bmcphail on Thu Oct 03, 2013 at 07:58:33 PM PDT

        [ Parent ]

    •  And For Him, It Would Include A Free Brain Scan nt (5+ / 0-)

      On the Internet, nobody knows if you're a dog... but everybody knows if you're a jackass.

      by stevemb on Thu Sep 26, 2013 at 12:45:04 PM PDT

      [ Parent ]

    •  Depends on who administers it and how. (0+ / 0-)

      A $700 screening colonoscopy administered in a doctor's office in Baltimore may be fully covered.  A $10,000 diagnostic colonoscopy administered in New York by a hospital with an attending anesthesiologist will likely involve out of pocket expenses.

      Not that it takes away from the diarists' larger point, but there are cheap colonoscopies even today that would still leave you with savings under the scenario depicted here.   The diarist points out that there could be several such procedures that easily eat up the rest in some given year, but as irresponsible as Calabrese is that cost can still be amortized over the life of the policy for significant savings.

      Of course this is all moot because as the diarist also points out, ACA forbids this sort of gaming by setting an age limit (and an income to expense formula) for determining eligibility for catastrophic only plans.  The idea isn't that--everything else invariant--it's irrational to try and engineer coverage like that (it's probably not), but that  many people doing so harms the broader availability of insurance.

  •  Colonosopies... (2+ / 0-)
    Recommended by:
    Dirtandiron, Rogneid

    Shhh... don't tell the conservative idiots like Dan Clabrese that!!

  •  He has to pay extra for his (11+ / 0-)

    Since in his case, the Colonoscopie would require a neurosurgeon...

  •  Fun fact about deductibles. (12+ / 0-)

    Let's say you go with:

    A policy in which he would prefer an annual deductible of $27,000.
    And you're diagnosed or hurt in December.

    Guess what?!

    By the terms of that policy, you'll have to fork over $27,000 in cash in December.

    And, if your medical bills continue, you'll get to do it again in January.

    So now your out of pocket was actually $52,000.

    But wait, there's more!

    If you're sick or hurt enough to be in this situation, it's likely that you'll have additional expenses not covered. You might need more meals out, or someone to watch the kids, or to buy special furniture, or pay people to mow the lawn. You could have substantial travel expenses, even hotel. You might need to pay someone to drive you to medical appointments. And, if you're not working, you might be forgoing a paycheck.

    You might have to put some of that on a credit card, and if your cash flow is affected, you might be paying some of that at a high interest rate.

    But wait, there's more!

    Now imagine your condition ends up being chronic. After wiping out your savings from the first $52k, plus all those new expenses you had... you may be paying that deductible out every year.

    This is how people go into medical bankruptcy, even when they have health insurance with much smaller deductibles. They compound.

    Fry, don't be a hero! It's not covered by our health plan!

    by elfling on Thu Sep 26, 2013 at 01:12:08 PM PDT

    •  Yep. Chronic conditions are key. (1+ / 0-)
      Recommended by:
      elfling

      A chronic condition can easily turn a high-deductible (or even lower deductible) health insurance plan into something very unaffordable for most people. The fact is that many, many people who are insured are very underinsured given their external financial resources. And, of course, the whole reason they are underinsured is BECAUSE they don't have lots of external financial resources and therefore can't afford a plan that actually provides adequate insurance to make living with e.g., a chronic condition affordable.

      Beyond just the huge consequences for individuals, this fact is a huge problem for the economics of private health insurance in a country where so many people can't afford health care OR adequate health insurance. It means that those with chronic conditions are the ones who are likely to actually view it as "worth it" to purchase "gold plated" insurance, and that undermines the cost spreading aspect. It also means that these high deductible plans do very little to control costs in the system, because chronic conditions account for a huge fraction of overall health care costs (and high deductible plans do nothing to address that cost problem, while doing a lot to shift the financial burden onto sick and poor people).

      Maybe this is too radical for this country, but I think that if we are going to have private health insurance at all (and I'd personally prefer single payer as it avoids all of these problems), then it should be ONE deductible/out-of-pocket/copay level that applies to EVERYONE in the country. There is no need for "customization" of health insurance, because we are all human and all have roughly the same medical needs over the course of our lifetime (or, at least, the same RISK of medical needs). All that the plethora of different insurance plans out there accomplishes is to shift the burden of unaffordable care onto people who can't afford it by undermining cost spreading.

      •  It's not just the chronic (2+ / 0-)
        Recommended by:
        barbwires, NoMoJoe

        When you have multiple family members, a string of unfortunate luck can involve an accident happening to one member in December and another in January etc. and then again the next year.

        Heck, having a baby in the fall could easily top that $52k.

        When people think about hitting their deductible and covering it with savings, they're thinking it would happen once. They never realize that the next emergency won't patiently wait for the savings account to replenish.

        Fry, don't be a hero! It's not covered by our health plan!

        by elfling on Thu Sep 26, 2013 at 05:57:43 PM PDT

        [ Parent ]

  •  If, when he turns 50, he undergoes a colonoscopy, (0+ / 0-)

    that $2400 procedure alone will put him in the hole by $1200.(1)

    Ohoho, I see what you did there!

  •  Gotta admire his stupid principles (3+ / 0-)

    Calabrese would apparently rather die than take advantage of this program because . . . well, why exactly? Because of socialism? The guy currently in the White House? It'll cost money, and Calabrese is constitutionally incapable of paying for stuff?

    I really, truly don't get it. I don't wish ill health on anyone, even on anyone stupid, but sooner or later everyone gets sick. Yeah, yeah, your Great Uncle Harold was never sick a day in his life, never went to a doctor, and dropped stone dead three days after his 95th birthday. But that's why Great Uncle Harold and those like him are so remarkable. They're slightly more rare than hen's teeth. You're literally betting your life that you will be so lucky. Not wise at all. And Calabrese's 13-year-old son doesn't even get a say in Daddy's madness. Fookin' brilliant.

    But it'll teach all you DFHs a good lesson for Calabrese to go without a net, by cracky.

  •  He (and his family) have never had the misfortune (2+ / 0-)
    Recommended by:
    drmah, Politics and A Beer

    to receive a cancer diagnosis, evidently.

    When that happens, the patient & family have plenty of other things to worry about, without scrambling to try to find a good insurance plan and get enrolled.

  •  Awesome Comments (1+ / 0-)
    Recommended by:
    nirbama

    I must say these are some of the more intelligent comments one would expect to find on the internet.
    As for colonoscopies being "free," I guess the more accurate term would be "covered," but we all understand what the poster meant.

    The "in the hole" comment was the best. And, $27,000 for 2 years is actually $54,000, but again, we get the point.

    Thanks for the great comments, they are appreciated !!!!

    ----Alec

  •  This is an excellent post and I hope Mr. Calebrese (1+ / 0-)
    Recommended by:
    Politics and A Beer

    and others reads it so they might decide to get coverage for their families.  Too many uninsured creates huge consequeces  for more than a few people.

  •  I still argue best approach to this ignorance is (2+ / 0-)
    Recommended by:
    Merry Light, Politics and A Beer

    to require the "uninsured" freeloaders to work for a month in the Cancer unit of their local hospital.

  •  Freeloaders (1+ / 0-)
    Recommended by:
    Politics and A Beer

    I keep wondering if there will be a change in the policies at hospitals and ERs.  Today, they will always take you, and if you don't have insurance and don't pay, then they just write it off, raise the prices on those of us that are insured, and move along.  But after this year, everyone is supposed to have insurance.  The hospitals should get a lot less forgiving on uninsured non-payers.  If students can't discharge debt through bankruptcy, then neither should people trying to game the health care system.

    I'm still mad about Nixon.

    by J Orygun on Fri Sep 27, 2013 at 09:53:40 AM PDT

  •  Dan is a friend of mine (1+ / 0-)
    Recommended by:
    Politics and A Beer

    Oddly enough. And very smart, too, though you might not think so considering his positions.

    He is very principled and very honest. I just don't happen to agree with or abide by his principles - but I respect him for sticking to them. One of those principles is loyalty to this odd ideology. So you wind up with columns and arguments like this one.

    I don't get where he comes from on this stuff. But I expect that it's his job at Cain to toe the party line, whatever it may be; I am sure the "correct" positions on issues are dictated from the top down, Stalin style, and it is up to CainTV staff to perform whatever verbal/logical gymnastics are required to adhere to them.

    Not an enviable position.

  •  Yeah, like my family would have had... (0+ / 0-)

    ...thousands of dollars lying around when I blew out my knee playing baseball right before I turned 13.

    Sorry, but things happen to healthy people.

    9-11 changed everything? Well, Katrina changed it back.

    by varro on Fri Sep 27, 2013 at 02:16:53 PM PDT

  •  Most people can't afford $27,000 out of pocket (0+ / 0-)

    if they end up getting a catastrophic illness like cancer.  

    Most women certainly can't, so I doubt many of them will take his advice.

    "The international world is wondering what happened to America's great heart and soul." Helen Thomas

    by Betty Pinson on Fri Sep 27, 2013 at 02:33:03 PM PDT

  •  Anyone (0+ / 0-)

    who makes the argument not to buy insurance because the odds are in his favor, doesn't understand the meaning of the word "insurance." You fervently HOPE you never have to use it.

  •  What about penalties? (1+ / 0-)
    Recommended by:
    Politics and A Beer

    Don't the savings disappear once you factor in the penalties for not buying insurance? Sure, in 2014 the penalties are small, but by 2016, the penalties for him and his wife alone would be over a thousand dollars.

    Also, I don't think we should be framing this as a rational cost-benefit analysis. It should be framed for what it is: shirking and trying to get a benefit only when you need it. This is exactly like not paying into Social Security then expecting the government to pay you a check when you retire.

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