Embracing a Bronze Plan: How I Learned to Stop Worrying and Love It

Bronze plans offer more savings on premiums than Silver plans for enrollees that do not qualify for the cost-sharing discount.
Accounts for tax-sheltered health savings, available primarily in Bronze plans.
At the very least, it is important to consider the psychological benefits of a lower deductible.
The employer-sponsored medical insurance plan is a comfort blanket for the majority of the 155,000,000 people who receive their health care coverage through an employer. You may find that the blanket is filled with holes if you look closely. Patients who need intensive care have many stories of woe. They include prior authorization hurdles, denials of coverage for needed care or medications, and, until recently, surprise payments from providers or doctors outside the network at in-network facilities (Congress banned all such billing with the No Surprises Act on January 1, this year). The No Surprises Act, which took effect on January 1, this year, banned most of these billings.

For almost all enrollees in employer plans, whose policies cover about 85% of medical costs, while the employer pays the majority of the premiums, medical insurance is not something to be concerned about. Others worry about losing it.

This was my situation until this spring. While I am self-employed my wife Cindy has worked at the same hospital for 25 years and has family insurance. We’ve had a good health record and have received care without any major problems, including an operation in 2004 to remove half of my thyroid.

Over the years, our premium share crept slowly up. Then it jumped from $200 per month to $400 in 2016, when Cindy reduced her work week from 36 to 30, so that she could help her father who was in his 90s. The cost is now around $450/month.

ACA Market Enhanced by American Rescue Plan
Change comes in many forms. Cindy will retire this month just a few days shy of her 64th birthday. The Affordable Care Act was supposed to make it possible – but since March last year, when the American Rescue Plan provided a significant boost to premium subsidies in the ACA’s Medical Insurance Market, the ACA is more credible than before about reducing “job lock.”

The ARP subsidy increases only extend until 2022. Democrats in Congress had intended to raise them further, but with their Construct Back Higher laws long stalled, an extension could now be removed.

The ARP reduced the percentage of income required to buy a benchmark Silver plan at every level and eliminated the infamous cap on subsidies. Prior to the ARP being implemented in March 2021 those whose household income exceeded 400% Federal Poverty Level – currently $51,520 per person and $106,000 for four people – were not eligible for premium subsidies. Cindy and I were particularly hard hit by the rising cost of premiums as we aged. At age 64, the price is triple that of a 21-year-old. Unsubsidized benchmark rates can be as high as $700-800 a month – or more – in some states. (That’s also about what COBRA costs us).

The ARP means that for anyone who does not have access to affordable insurance, a benchmark policy will cost no more than 8.5%, and even less if you earn less (in fact, benchmark coverage is free up to 150% of FPL). Modified adjusted gross income (MAGI) is the measure used to determine premium subsidies. This is primarily the AGI familiar to tax filers. However, a few other sources of income are also included, such as tax-exempt interest.

Cindy and I are able to get a benchmark silver plan for $400 a month due to the ARP subsidy boost, along with a large fee to my individual 401k, which reduces our MAGI. In contrast to many states, the major market insurers in New Jersey have a respectable provider network.