Uninsured Opting to Forgo Health Plans, Cite Cost

Despite enrollment deadline extensions and expansion of the federal poverty guidelines, many uninsured Americans are choosing not to obtain health plans on insurance exchanges. When asked why they would refuse coverage, half of those polled cited cost as the main reason, while another 3 in 10 said they opposed the government mandate. Others also said they felt they didn’t need the coverage.

“It doesn’t scare me not to have it,” said Heidi Reinberg, who lives in New York. “I’d rather pay down my credit cards than take on another bill for something I don’t know that I’m going to need.”

Many consumers share the sentiment of Ms Reinberg, even if it means they will receive a financial penalty from the government. They say that healthy behaviors and habits will negate the need for costly coverage.

As time progresses, however, those attitudes may change. A recent report says that an individual who never buys health insurance will pay an estimated $37,000 in fines—or $110,000 for a family of 4—over their lifetime. When those costs are combined with the medical expenses that come with being uninsured, more are likely to change their minds.

“Even lower-income individuals and families will end up paying hundreds, even thousands, of dollars per year in penalty fees in coming years. This will create a significant financial burden for this population, increasing the incentive to instead purchase insurance,” said Christina LaMontagne, vice president of health at NerdWallet, an investment information group. “Regardless of whether or not the government’s enrollment goals are reached in 2014, the long-term outlook for uninsured rates is positive. Between elevated awareness about the importance of health insurance, the ironing out of marketplace kinks, and an increasingly large disincentive to going uninsured, many Americans will seek out and obtain affordable health insurance—ultimately leading to decreased health costs and increased health awareness on a national level.”

Around the Web

Looking at Costs and Risks, Many Skip Health Insurance [The New York Times]

Study: A Lifetime of Obamacare Penalties Can Total Six Figures [NerdWallet]