The USA health insurance can sometimes seem complex… To help you better understand how it works, BSI raises a few essential points.
The U.S. health insurance system
In the United States, health insurance is primarily a private, except in the case of MEDICAID or MEDICARE system (for low-income people) (retired people of 65 years and more). The Americans do not have the equivalent of social security in Europe. The cost of the health in the USA is also much higher than in Europe. Thus, should an average American on average spend more than 17 000 USD for his family's health insurance (source: The Kaiser Family Foundation). Difficult to compare with, for example, employer and labour social contributions in France (insurance pay-as-you-go which includes also "retired"… contributions) but this gives an idea of the percentage of the American salary to devote "insurance"… Before 2014, health insurance was not mandatory in the USA. But since the establishment of "Obamacare", all tax residents in the USA are obliged to have health insurance. Each contributes according to its means and risks he wants to cover. This system is based on prevention and allows the Americans to avoid abusive recourse to emergency, by care earlier. The Obamacare contains 10 essential points that should be included in the contracted insurance (emergency, hospitalization, maternity care, dental care, pediatric care, ophthalmology…). The policies offered by private insurers in the USA include "franchises", called also "co-payments", "co-insurance" or even "cost-sharing". They are much more important than "co-payments" that we know with the French social security. However, they will be capped at a "maximum out of pocket" which corresponds to the maximuale amount you may have to pay per year (approximately $7,000 / year for a single person, for example). Beyond this amount, the insurance shall take your expenses support 100%. These parameters will determine the price of your insurance… More "franchises" levels will be high, more your insurance will be cheap. In practice: all compatible "Obamacare" insurance is not the same! Note that the employer is not required to provide health coverage to its employees. This is may be the case from January 1, 2017, for companies with more than 50 employees, if nothing changes here here…
Should we prefer "Obamacare" insurance or an international contract?
The taxpayer who, during his tax declaration, cannot justify the subscription to a contract "Obamacare" will be a penalty. For example, a single person who would gain $ 35,000 will be a penalty of 621 euros if it doesn't have a compatible "Obama" contract. This penalty shall not apply to persons who reside less than 330 days per year in the USA, nor to international students in the USA. In these circumstances, many expats in the USA prefer to keep health insurance "international", the 1st euro or in addition to a basic scheme (but non-compliant with the Obamacare), even if duty pay a penalty. The penalty is usually less important than the amount of "franchises" mentioned previously. Then, they retain the ability to get treatment in their country of origin as in the USA, the free choice of medical providers, without franchise contracts, the choice of securities (with or without maternity for example)… Your insurance broker will help you select the most suitable insurance in the USA according to the desired guarantees and in respect of your budget. Feel free to contact us for any further information.