A Midwest mom’s two-month struggle to secure health coverage for her family on the federal marketplace continued into the new year as she must now decide whether or not to put her children on Medicaid or to keep them as part of her family’s insurance plan and lose the subsidy she and her husband are eligible for under the law.

Wendt, a 30-year-old mom of five from Grand Rapids, Mich., has been trying to secure insurance for herself, her husband and five children on an exchange-sponsored insurance plan since Oct. 1, and spent the majority of her Christmas Eve on healthcare.gov and on the phone with the representatives from the website. She was concerned about having coverage on Jan. 1, after her family’s Blue Cross Blue Shield plan was cancelled for not meeting certain requirements under the Affordable Care Act.

While attempting to enroll, Wendt repeatedly ran into a glitch claiming her children were not U.S. citizens (they are) and therefore were ineligible for coverage on the exchange. She was able to secure temporary coverage on Dec. 31, 2013 from Blue Cross Blue Shield that carries a monthly premium of $400, and a $17,000 deductible. This plan is a lot more expensive than the family’s old coverage that had  a monthly premium of $260 and a deductible of $5,000.

One week into the New Year, it seems Wendt has finally cleared the glitch but is still facing sticker shock. She found that because she and her husband are small-business owners—Zach is a real estate agent—and they take certain business deductions, they fall right under 200% of the federal poverty line. This makes them subsidy eligible, and their children Children’s Health Insurance Program (CHIP) eligible.

“If we want our children on our family plan—whether its two or 10 people—we lose the subsidy,” Wendt says.  “It’s amazing that they are forcing families onto government health-care. It almost feels like an attack on small business owners.  This revelation is more frustrating than the initial glitch.”

Under the ACA, every American must have insurance by the end of open enrollment period on April 1, or they will face a fine of $95 a year or 1% of their annual income, for failing to comply. Nearly six million Americans have lost their old coverage because the plans failed to meet certain requirements under the law, covering 10 comprehensive benefits from ambulatory services to prescription drug benefits.

Paul Howard, director and senior fellow at the Center for Medical Progress at the Manhattan Institute, says it’s unclear if the issue the Wendt family encountered is unintentional, or if it is a mechanism to offset the score of the bill, as CHIP is less expensive than federal subsidies. 

“This matters because a lot of Medicaid and CHIP programs pay physicians less than private insurers and Medicare,” Howard says. “When [patients] go to see a specialist, they may wait longer, or not even get to see some of the doctors they want to see. I can’t think of a reason why you wouldn’t give them the subsidy for the parents’ coverage, and then let them buy into the policy [for their kids] and pay out of pocket to do so.”

Regardless of the cost, parents should have the choice, Howard says, adding it’s unclear how many families fall into this scenario.

A spokesperson for the Department of Health and Human Services says it does not have statistics on how many people would be impacted similarly.

Wendt says she will continue to search for a less-expensive plan off of the exchange, to see if it’s possible to lower their current deductible. If not, she says she will stick with her current temporary plan, despite its high deductible.

“The law isn’t making health-care more affordable, it’s masking a huge price increase,” Wendt says.

And the kicker is that the family had insurance, that they liked, before it was cancelled, Howard says.

“We allow people to buy gold coverage instead of silver coverage,” Howard says. “If you don’t qualify for subsidies, you can still buy child-only policies on the exchange. There is no reason why you can’t turn to insurers for the same.”

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