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Many people are finding that the Affordable Care Act, or ACA, doesn't provide quite the level of affordable care they had anticipated. As a result, there have been countless stories of sticker shock, in which people who expected to pay lower rates have ended up getting inferior insurance at a higher cost.
Has this all been overblown by the media, or are the costs really that high? How will it affect you, specifically? NerdWallet investigated how much health insurance costs under the Affordable Care Act.
The big picture
It's true that the ACA has raised some health insurance rates. However, this is true only for certain Americans, as others will obtain more favorable rates.
Insurance companies can no longer deny customers for pre-existing conditions, and are not allowed to charge older subscribers more than three times what younger customers are charged. This means that, in general, the younger and healthier you are, the more costly ACA plans will be for you -- because you'll be paying for benefits and services that you don't necessarily need. Meanwhile, older and/or unhealthy Americans will benefit the most and some will pay less than before.
Young, healthy males to take the hardest hit
Those who consume the least health care will naturally subsidize those who consume the most. Since young males typically have minimal health-care needs, they'll pay far more than their fair share.
A study by Sector & Sovereign found that a 21-year-old man will pay an average monthly premium of $261 per month for a plan with the same deductible as a pre-ACA plan -- an 81% increase. A separate analysis confirmed steep premium increases for young males, finding that the average 27-year-old male will pay 77% more for health insurance.
The American Action Forum paints an even bleaker picture, noting that the average 30-year-old male nonsmoker will pay 260% more for the cheapest insurance option.
Older women will benefit most
Women, on average, use more health-care services than males -- just as the elderly use more than the young. This means being elderly and/or female is financially advantageous under the new health-care law.
The average 64-year-old woman can expect a 32% reduction in expenses after subsidies are considered.
What this all means for you
While every study on premium increases and decreases has yielded different results, here are a few key numbers to take away as you adjust to the new health-care system:
- 56% of uninsured Americans could purchase coverage for less than $100.
- Nearly half of single young adults may be able to get coverage for less than $50.
The bottom line is that whether you will pay more or less depends on your specific health status and needs. While young males, in general, will pay more, there are some with pre-existing conditions who will save a significant amount of money with an ACA plan.