The Obamacare benefit nobody talks about.

Quick non-political FI/ER-related post after last night’s dramatic Senate vote to kill the “skinny repeal” bill and by default leave the Affordable Care Act the law of the land. This is a policy post; political comments will not be approved.


Roughly a year prior to the enactment of the Affordable Care Act we learned that my wife had ductal carcinoma in situ, the most common form of breast cancer. Thanks to regular mammograms her doctor caught the cancer before it spread to her lymph nodes, so she had hasty outpatient surgery to remove the tumor, got radiation and hormonal treatments, and has since been cancer-free…obviously cause for great celebration.

However: from the very moment of her diagnosis we were stuck in our home state; no longer free to move beyond its borders. Here’s why.

As you probably know, the ACA’s preexisting conditions clause prohibits insurers from denying coverage to individuals with serious medical problems. Before the ACA, though, insurers were free to write multi-year exclusion riders, or outright deny you, for specific conditions like…you guessed it…breast cancer. If you’d had your condition prior to buying a new policy, tough shit. You yourself were responsible for every penny of the costs until the exclusion rider expired. No insurer would cover you.

And since customers can’t buy health insurance across state lines, as of the moment of your diagnosis you were trapped in your home state. If you’d moved across state lines you would’ve had to buy a new policy, and if you had to buy a new policy, you’d incur a new preexisting condition exclusion or even complete coverage denial. So again, you’d be on your own for any costs associated with your condition.

In short, you were state-locked.

Now…picture this situation.  You’re an only child. You and your spouse are self-employed and work from home. Your jobs are completely portable. The two of you have a teenaged daughter who suffers from type 1 diabetes.

Your father has already passed and your elderly mother lives halfway across the country. She develops macular degeneration and starts losing her eyesight. She needs in-home care but for whatever reason can’t get it through her insurer, be it public or private.

It now falls on you to care for your mom, but since your daughter has type 1 diabetes you can’t relocate your family to where your mom lives unless you’re willing to shoulder the costs of your daughter’s treatment yourself. No insurer will touch you, so you’re stuck where you are despite the portability of your jobs.

So you clean out the spare bedroom in your mom’s house and move in with her and give her the care she needs. But since your family has to maintain its current residence to maintain its current health insurance policy, you only see your spouse and your daughter once a month.

See where this is going? It’s not a farfetched scenario. Until the passage of the ACA, your daughter’s diabetes would’ve essentially split up your family. How about that?

And that’s the benefit nobody talks about. For obvious reasons it has a heavy, heavy effect on your ability to work towards/achieve financial independence and early retirement.

Author: ER Dude

Sick of your job? After a thirteen-year career, Early Retirement Dude fled corporate America for good. You can do it too! Visit http://EarlyRetirementDude.com or email EarlyRetirementDude@gmail.com.

5 thoughts

  1. Great post – very valid and real-world example. It’s sometimes hard to put yourself in others shoes when it comes to such complicated/multi-layered issues and a not-so-abstract example can sometimes help bring things into perspective. In your effort keep it strictly to policy, you may want to just refer to the existing policy as ACA – the other name is slightly politically charged and might distract off the bat. Just a thought. Thanks for the great posts as always.

    1. I appreciate the kind words. Good point on the ACA name neutrality. I’m invested in the title at this point but within the body of the post I’ve made the change you suggest.

  2. Thanks for highlighting the human side of this. I mercifully don’t have preexisting conditions, but I do enjoy many benefits from this policy, like free birth control every month (my cost used to be $100 WITH insurance–ouch).

    1. >I mercifully don’t have preexisting conditions

      I’m glad. And that’s the thing…I know you’re aware of this, but there are two kinds of people: those who are sick, and those who WILL be.

  3. Along the same lines, and more generally speaking, we are not so much tied to our employers (for some people, health insurance is the main reason to have a job). The flexibility this creates benefits not only freelancers and contractors but every single one of us.

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