A Fistful of Failures

I gritted my teeth and wasted six hours this week trying to beat the health insurance system.

Commonwealth Care’s online worksheet makes it official: We legally can’t afford health insurance. The state figures that we should be able to pay about $500 a month for insurance, and there’s nothing available that cheap. Massachusetts will graciously exempt us from being fined if we choose not to buy insurance, but they won’t help us pay because we make more than three times the poverty rate. Although it's nice to know that it's legal, going uninsured is a last resort. FAIL

Commonwealth Choice is the state’s insurance clearinghouse. Their website offered 21 plans ranging in price from $732 to $2,071 per month. We currently pay about $925 for Blue Cross Blue Shield of California. A comparable BCBS plan through Commonwealth Choice is $1,112 – about what we’ll pay for our current plan after COBRA expires. The only option that really saves us any money is the $732 Neighborhood Health Plan. It carries a $2,000/$4,000 deductible (vs. our current $500 deductible)...and our doctor doesn’t accept it. Changing doctors is a nonstarter. FAIL

All righty then, what about getting a group rate through some club or association?

Sadly, AARP group insurance (via Aetna) is still not available in Massachusetts. FAIL

AAA offers dental, life, homeowners, auto, long-term care, accident, and travel medical…but no general medical insurance. FAIL

The American Society of Journalists & Authors has nothing for Massachusetts. FAIL

Anne doesn’t qualify for membership in the Author’s Guild. FAIL

The Editorial Freelancers Association has nothing at all. FAIL

Health Service Administrators (HSAmembership.com, formerly the Mass. Business Council) is wicked confusing. All I could find were a bunch of links to insurance company websites with no information about pricing. I need to spend a couple more hours examining all of those links. Provisional FAIL.

The cheapest Fallon Community Health Plan that our doctor accepts is $942/mo with a $2,000 deductible. It does include dental, which we currently lack, so in that way it’s better than our current BCBS plan. FAIL for now, but I might come back to this one after COBRA runs out.

Various online quote finders are really just trolling for my phone number -- they don’t really show quotes online. The two agents who tried to sell me cut-rate coverage were both peddling Mid-West National Life, which Google tells me is the object of numerous complaints and lawsuits. FAIL. We already have enough problems with Blue Cross. (In fact, the next item on today’s agenda after posting this essay is calling a collection agency that’s dunning me over a wrongly-denied medical bill).

Speaking of problems with Blue Cross, here’s a funny story: South Shore Hospital billed BCBS $691 for an X-ray that Anne needed. The hospital settled for the $270.85 that BCBS said was the covered amount. But they raised our deductible last month from $250 to $500, and there was a $20 copay. Bottom line? BCBS paid 85 cents. We got billed for $270.

For this, we pay $925 a month?

CONCLUSION: It is difficult to get a group health insurance rate and impossible to get a subsidy without either having a job or being truly impoverished. Unemployed individuals have no alternatives to paying retail, and Massachusetts has the highest health insurance costs in the US.

So I’m going to have to be creative.

Kraken Enterprises could establish a Section 125 Voluntary Plan and designate Commonwealth Choice as an available health insurance option. (A Voluntary Plan is one to which the employer does not contribute.) I’d then set up an account with the Health Connector (which represents six carriers). My employees – i.e., me – can then enroll in a Commonwealth Choice plan through the Health Connector. Kraken Enterprises would collect my insurance payments via payroll deduction on a pre-tax basis. Kraken is then billed for my health insurance premium on the 15th of every month. Any shortfall is the responsibility of the employee – i.e., me.

The monthly insurance premium is triple my gross monthly salary, so payroll withholding is a joke. But wait. What if Anne’s freelance business became a Kraken enterprise? She’d become an employee of my company and her revenues would filter through my corporate accounting. The accounting would be a nightmare – I’d need to manage a separate operating company. I would need to consult my CPA and probably a lawyer as well. It would certainly complicate our already-Byzantine tax situation. After all of that, I have no idea whether this would actually save us any money. As far as I can tell, the only advantage is paying in pre-tax dollars. I’d need to actually create the Section 125 thingie and get an employer number before I can see the employee pricing – I assume it would offer me the same 21 plans that I saw as an individual, and probably at the same prices. Although I'm reluctant to draw the state's attention, maybe I’ll do that next week.

Having two employees would magically qualify Kraken Enterprises to purchase group-rate insurance outside of the Commonwealth Choice umbrella. (The insurance industry defines a “small business” as 2-19 employees). Creating this legal fiction might get us around the assumptions that are limiting us to individual/family coverage. However, being married might screw that up. Insurers want two potential enrollees. I wonder how we’d make out if we got divorced and bought two individual plans? We are both willing to divorce if it will save us enough money on health insurance.

Next week I should spend a few more hours on this:

• I need to investigate the comparable options available to the self-employed. I really prefer to keep our businesses separate, if we can.

• I need to revisit that inscrutable Health Service Administrators website and see if it can make some sense out of who they are and what they do.

• I might open a Section 125 plan so that I can price the insurance options available to employees of Kraken Enterprises. That’s the first step in figuring out whether taking over Anne’s freelance business and getting divorced make financial sense.

Two things are certain: First, my dad was a top casualty insurance salesman for 35+ years, and my go-to guy for everything insurance related. I wish I could talk to him now. Second, if I was 13 years older I could just get Medicare and wash my hands of all this. I honestly don’t know how we’re going to get through the next 13 months, let alone 13 years.

Incidentally, it does not appear that federal healthcare reform is going to help us. The plan that's taking shape cuts off subsidies at double the poverty rate.

The only thing that would save our bacon now is if Congress extends the COBRA subsidy for another nine months. AFAIK, that has not even been proposed.

For Richer & Poorer

September goes out with a rock-‘em sock-‘em week. The numbers below tell most of the story. I spent more money on inventory this month than in any previous (non-Christmas) month. None of my new merchandise is doing much yet, but that’s to be expected. It takes time for the Internet to absorb a new product page.

Panther Vision forced my hand by rolling out a third-generation cap, available (so far) only in black. I combined a case of those with a reorder of other colors in the “old” style. A couple of days later Panther unexpectedly landed a container of Power Caps in several more colors, rendering most of my $1,000 reorder obsolete before it even arrived. By way of apology, Panther let me place a small order for the new-style caps at their big-order price, but it still put the kibosh on my new-product acquisition plans for now. I have paused to catch my breath.

Are you here to read more of my health insurance soap opera? Well, I fiddled with it a little bit. The first step in determining whether we can get state subsidies is figuring out our annual income, which is bloody hard to do. Anne was employed for a month. There was a check for unused vacation time. Then she got unemployment checks, but not every week; she had to skip checks in weeks that she reported freelance income. I have kept track of the estimated taxes due on her freelance income, but not the income itself, so I had to guess at that for Q1 and Q2. Did I remember to include her parttime teaching salary? Half of my Kraken Enterprises salary won’t be earned until Q4, so I have to guess at that, too. Whatever profit Kraken reports at the end of the year also counts as personal income. The number that I finally came up with for our combined gross income is only accurate to within 15- 20%. We should earn about half of what we made last year.

The “good news” is that we might be in the sweet spot…poor enough to qualify for subsidies, but not so poor as to actually be, you know, poor. I might have time to explore Commonwealth Care later today…or it might slip into next week.

Last Tuesday I came into a little money from an auto insurance refund. I deposited that check on Wednesday, intending to apply it toward debt. On Thursday a collection agency dunned me for a medical bill that I never intended to pay (some faceless clinic doctor that I’ll probably never encounter again)...but since the bill was almost exactly the same amount as my windfall, I figured I might as well buy peace. This morning I wrote the check and sealed the envelope, relieved to be fully paid up at last. An hour later the mailman brought us another medical bill. The hospital charged Blue Cross Blue Shield $617 for an X-ray. The hospital settled for the $270.85 that BCBS allowed for the procedure. As it happens, our deductible reset on Sept. 1. With the copay, we are responsible for $270. BCBS paid the remaining 85 cents.

For this coverage, we pay $925 a month. What’s really funny is that they really should not have even covered the 85 cents. Our deductible doubled this month.

So now I have another unpayable medical bill on my desk, twice as large as the last one. Oh well, it won’t go to collection for at least a few months.

Enough of this depressing health care crap. Here are the rosy September numbers:

Total income: +72.5%
Total COGS: +42.2%
Payroll: +108.3%
Net Income (Profit): +1,076.9%

Year-to-date:

Total income: +18.6%
Total COGS: +15.5%
Payroll: +25.0%
Net Income (Profit): -36.7%

I'm still far below my ultimate goal of earning minimum wage, but do you know anyone else who’s making 25% more than LY?

Less Coverage, Bigger Bills

After I posted last week’s health insurance essay I told Firefox to stop blocking ads on this page, just so that I could see what Google’s serving up. As I suspected, all the ads are for health insurance now. Well, what the heck? I get a few cents whenever somebody clicks one (hint, hint). Clicking ads on your own site is considered click fraud (as is imploring readers to click them, hint hint), but I’m legitimately interested in the products. I even filled out some forms and got a couple of phone calls. I’m still avoiding doing real legwork, though. Neither Anne nor I wants to go through the hassle of changing insurers, and we’re still hoping that she might get a job offer any day now. And so I procrastinated for another week.

We downgraded our COBRA policy to offset the recent rate increase (the monthly payment rose by $96, the deductible doubled, and the copays increased by 50%). Instead of a 90/70 plan with a $500 deductible, we now have an 80/60 plan with a $750 deductible for $150 per month less. I don’t understand what those numbers mean, but since we can’t afford to use our insurance anyway it hardly matters.

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My HP Deskjet 6980 crapped out on me after four years of daily service. Printing suddenly slowed to a crawl and the clarity degraded. Hours of troubleshooting failed to shoot the trouble. In our throwaway society it’s cheaper and easier to replace it than to repair it…and it always had some annoying quirks (WiFi was very difficult to set up, and it balked at using third-party cartridges). So I bought a wireless HP Officejet 6000 for $90, delivered. It’s supposed to be a simple, reliable, and above all economical printer. It will be at least the fourth HP inkjet that I’ve owned. That’s $90 that I’d like to have spent on something more productive, of course, but…what can you do?

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Hey, I’ve got two Facebook fans that I don’t know. Actual fans! I wish I could afford to spend more time figuring out how to pimp my Facebook page. I’ve given up on Twitter. I simply don’t see any point to it.

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Sales have been very good for the past couple of weeks. Three institutional sales (all via telephone and one of them quite huge) have already put September ahead of plan and way over LY – with over a week left to go! Today I finally earned a big enough paycheck to dig out of the personal financial hole that summer vacation dug for me.

Oh, and one other thing: Citizens Bank approved my Mastercard application, so I should soon have my customary credit line restored. After all the years that banks showered applications upon nonexistent household members, who would have guessed that getting a credit card would ever become difficult?

OK: Next week I shall grapple with the health insurance bugbear. I’ve been ordering new merchandise like crazy, but I'm finally scraping the bottom of the budget and I sure don't want to start that new Mastercard off with a balance.