The news broke yesterday: noted Obamacare opponent Sen. Ted Cruz may sign up for Obamacare.
Cruz previously had a health plan through his wife Heidi's job at Goldman Sachs. But the family will lose that coverage when Heidi takes a leave of absence to campaign full-time. And this will put the Cruz family into a situation familiar to millions of Americans: figuring out what to do when you can no longer get coverage through work.
Now, Cruz's situation is a little bit different — he's a member of Congress, so he will have a job even after his wife Heidi leaves hers. But under Obamacare, legislators can only get their coverage through the law's insurance marketplaces rather than the Federal Employees Health Benefits Plan, which covers other federal workers.
This means Cruz will likely spend some time shopping on Healthcare.gov. And because of the new window-shopping options the website added this year, we can actually see the plans the senator will choose from. But first, we have to enter in some information about the Cruz family.
The key details: where the Cruz family lives, and how much they earn
The first thing you need to tell Healthcare.gov is where you live. I do not know the Cruz family's exact address, so I chose a zip code (77001) from their hometown, Houston.
Then Healthcare.gov asks for an estimated income. I put in a nice round number of $200,000 — Cruz earns $174,000 annually as a United States senator, and his wife likely earned some money at Goldman Sachs this year. The number is a bit irrelevant: Healthcare.gov uses it to figure out whether a family qualifies for financial help, and any family of four that earns more than $97,000 (as Cruz will with his salary alone) does not qualify.
Next, I enter the ages of the Cruz family members.
And now, the fun part: shopping!
The Cruz family will have 71 plans to choose from on Healthcare.gov
The options are pretty different, too. The premiums range from $585 to $1,665. The lowest deductible is $0; the highest is $8,000.
The least expensive premium plan is offered by a company called Community Health Choice. This appears to be a plan that typically helps provide coverage to Texas Medicaid enrollees, but decided to get into the private insurance market with the launch of the marketplaces. Community Health Choice offers coverage mostly in the southern Texas region — one reason to think the network might be somewhat limited.
The benefits of this plan are, admittedly, not that robust.
The thing that jumps out here is the $400 copay for emergency room visits. That is, obviously, really giant — and you see it right away in the Healthcare.gov summary.
If you dig into the plan benefits a bit more, there's another potentially alarming feature of this plan: a 35 percent co-insurance for specialty drugs. This means the patient is on the hook for 35 percent of his or her specialty drug costs — and as of late, specialty drugs have gotten pretty expensive. The best new Hepatitis C treatment, for example, costs $1,000 per pill.
And all of this is after an $8,000 deductible.
If the Cruzes generally plan to stay healthy, and don't have chronic medical conditions, it's possible this could be the best deal for them: they'd have a low monthly spending commitment. But if they have any sort of medical emergency — if one of the kids ends up in the ER, for example — this plan could quickly become more expensive than the other options.
The most expensive plan the Cruz family could buy costs $1,665 per month
The premiums are high on this UnitedHealth plan — and what you're paying for is a plan that leaves you less financially exposed to various medical costs. There is no deductible on the United plan, meaning that the coverage kicks in as soon as you start using medical care. The copays aren't particularly high, either: $25 for primary care and $35 for a specialist.
But there is one red flag in this plan: it charges a 20 percent co-insurance for any visit to the emergency room. I'd worry even more about this than the $400 emergency care copay in the other plan, because 20 percent of an emergency department bill could be a ton of money.
We know there's huge variation in the cost of going to emergency room; one study in 2013 found that getting a headache treated there, for example, could cost anywhere from $4 to $24,110. If you're the person who ends up at the hospital that charges $24,110 to treat a headache — and you have 20 percent co-insurance — that leaves you on the hook for $4,822.
For that reason, the Cruz family should be wary of this plan — or any plan that uses a co-insurance structure for emergency care, rather than a flat copayment.
The one thing that's hard to find: network information
It's relatively easy to figure out the cost-sharing structure of plans on Healthcare.gov. But figuring out which doctors would be in the Cruz family's network? That's more work.
If you want to know who is in the UnitedHealth network for that $1,665 plan, for example, you click on the link that says "see provider directory." This takes you not to a provider directory, but instead to a separate UnitedHealth site where you click another link to get to another place where you can search the provider directory.
What this lets you do is search to see if a specific doctor is in network, and that's helpful if you have a specific doctor you know you'll want to see. But what you can't really do on Healthcare.gov right now is get a sense of how big your network is — if you randomly show up at an emergency department, for example, will your coverage work there? This is typically an important factor in deciding what health insurance plan to purchase, and one that's not easy to research on the current website.
So, what will the Cruz family buy?
The plans I looked at above are arguably the extremes of the health-care options the Cruz family will see. But they're not representative: most of the plans have a premium that hovers around $1,000 to $1,200. And this is arguably the most confusing space to shop in, because there are about 50 options to choose from.
They're all slightly different; the copays for non-emergency care vary by maybe $10 or $15. Here, there's really no best option for coverage. It all comes down to a family's priorities, and what type of care they expect to use in the next year.
Do they want a plan with predictable charges, regardless of where they get care? A plan that relies on a copay structure (a flat fee for each type of doctor visit regardless of the doctor's charges, as used in this Blue Cross Blue Shield plan) might be their best bet. Or do they want to price-shop for care? In that case, a co-insurance structure (where you pay a set percentage of a doctor's charge used in this Humana plan) might be their best option.
These questions are always hard to answer because health care is unpredictable; we never know which year we'll end up with a broken leg or a bout of the flu, and which years we'll never set foot in a doctor's office.
But here's what's arguably most helpful about Healthcare.gov, to the Cruz family or to any shoppers: it actually shows you what those charges are. In the individual market before Obamacare, this type of information was difficult to find — and, if you could find it, it might be buried on page 26 of a fine-print document. Healthcare.gov provides a lot of real, actual information about the product you're purchasing. This is common sense in most industries — but pretty new to the health insurance world.
So the Cruz family will have a decision on their hands: which of these 71 health insurance products to purchase. Thanks to Obamacare, they'll have some pretty good information about their options.