What Happens When Marriage Makes Health Insurance Unaffordable

Dec 2, 2015

Not long after Sherry Poulin married her husband Louis last year, the newlyweds sat in their kitchen with health insurance information laid out in front of them.

“We were like, this is just not, this is not do-able,” says Sherry.

Sherry Poulin and her mother, Laura Brennaman.
Credit courtesy Laura Brennaman

Before getting married, Poulin paid $50 a month for a subsidized plan through Obamacare. Now, for a plan offered through her husband’s employer, she was looking at about $500 a month.

Poulin married into what’s known as the “family glitch”: when she got married, she lost her subsidy to buy insurance in the individual marketplace.

Under the Affordable Care Act, if one person in a family has a job that offers health insurance to the rest of the family then nobody can get subsidies on the federally run exchanges. Almost everyone who buys health insurance through those exchanges gets tax breaks to make it more affordable based on their income.

Nobody’s counting exactly how many people are going without insurance because they’re in this family glitch, but a recent study from the Kaiser Family Foundation estimates that more than 400,000 Floridians went without health coverage—even when they could have gotten it through work.

So while it’s open enrollment season for health insurance through the Affordable Care Act, not everybody who wants to buy insurance is finding it affordable.

“It has, you know, kind of scared me that something bad could happen,” says Poulin, who decided not to buy insurance.

She works for just above minimum wage at a Fort Myers coffee shop that doesn’t offer insurance. Her family income is less than $53,000 a year. Even though she has a chronic sleep disorder and needs to see a doctor every three months, it didn’t make financial sense for her family to buy a full-price plan.

ROCK AND A HARD PLACE

Big employers have to offer “affordable” health insurance options to employees to avoid federal tax penalties. An affordable plan for the employee can’t cost more than 9.5 percent of her household income.

But the rules don’t apply to family members of the employee.

“You have a family that is caught between the rock and the hard place,” says Steven Ullmann, director of the Center for Health Sector Management and Policy in the School of Business Administration at the University of Miami. “[Health insurance is] not affordable through the employer, not affordable through the exchanges, through federal subsidies. And that’s the glitch.”

As health insurance costs keep rising, the family benefit is one of the places employers can shift costs without getting fined. And, says Ullmann, there’s reason to believe more families will find themselves in this situation.

“Employers are really scratching their heads in terms of trying to get these costs under control,” he says.

And when people find out they can’t get tax breaks on the individual marketplace because of the offer from work?

“They’re upset,” says Greg Jenkins, a navigator with the Epilepsy Foundation of Florida. “They’re upset with—let’s call the Affordable Care Act ‘Obamacare’—and they’re upset with their employer. The option is either suck it up and cover the spouse or dependents, that is pay the full freight, or no coverage at all.”

For the past three years, Jenkins has helped people sign up for Obamacare and he says he’s seen a lot of people in the family glitch. He tries to point adults in this situation towards charity programs. And for their children, Florida KidCare is a government subsidized insurance option.

STILL SEARCHING

Sherry Poulin and her daughter, Story.
Credit Courtesy Sherry Poulin

Poulin did just that; she put her 4-year-old daughter, Story, on KidCare.

For herself, Poulin pays out of pocket to see her doctor. For her sleep disorder, she takes half the prescribed medication.

“It makes it hard for me to stay awake and to function at a normal level throughout the day,” says Poulin.

“I didn’t know… that she was trying to stretch her medication out,” says Laura Brennaman, Poulin’s mom. “And that breaks my heart.”

Brennaman is a former emergency room nurse. Now she’s the policy director for Florida CHAIN, a group that advocates for affordable health care—including fixing the family glitch.

Brennaman was part of a group that recently urged members of the Florida Office of Insurance Regulation to issue language clarifying what employers do and do not have to offer. She wants employers to understand how offering high-cost insurance sometimes leaves people in a worse position than if they offered nothing at all to families.

For Poulin, the family glitch doesn’t just mean going without insurance and taking half of her medication; it means she doesn’t run around and play with her daughter the way she used to.

“I’m just too tired for that. It sucks,” says Poulin. “It makes me feel like a crappy mom.”

Which is part of why she’s trying again to find health insurance—even without the subsidies.

Open enrollment overlaps with the holiday season,  and her mom says her gift this year is going to be help paying for health insurance.