11/22/2020: The birth of my son, and a case study in why it no longer makes sense to wor

On 11/22/2020 at 2:39 AM, we welcomed my third child and second son into the world in Ketchikan, Alaska.  Little Wally came about 1 week early, after shopping for Christmas presents for our other two children. Thankfully everything went well, and we were able to be discharged home 36 hours after the birth.  However, the costs associated with the labor, delivery, transportation, food, and housing for the delivery of our child is just another POS and example of why it no longer makes sense to try to get ahead in the United States

Living in rural Alaska means leaving our little town of Wrangell and heading to a larger town such as Ketchikan, Juneau, Sitka, or even Seattle.  Due to the excellent care we received with our first two children and the close proximity (100 miles,) we continue to choose Ketchikan for labor and delivery.  Local physicians require all expectant mothers to go off island at least 2 weeks before their due date as the facility isn’t equipped or prepared for labor and delivery, due to this reason, my wife packed up and left with her mother and our 18 month old, while I stayed behind in Wrangell with our 3 year old daughter.

The first expense incurred was the travel to Ketchikan from Wrangell on Alaska Airlines, coming in at 300.00 for my wife and her mother, as any child under the age of 2 flies free as a “lap infant.”  The second, and most costly part of the trip was the Air B&B that we rented coming in at 1600.00 for a 2-bedroom 2-bathroom apartment less than a mile from the hospital.  This was the cheapest option for a long term stay in Ketchikan.  The next expense was $1,000.00 for a ferry trip for our vehicle from Wrangell to Ketchikan.  Due to the high cost of taxis in Ketchikan as well as the high cost of renting a vehicle in Ketchikan, it was more cost effective to ferry our own car than to try to rent or use a taxi for the 2-3 weeks we were expected to be in Ketchikan.  Additionally, we were able to stock up on items that are much cheaper in Ketchikan and have them return to Wrangell in the car saving us money in the long run.  Next, we have flights for my daughter and myself down to Ketchikan at the expense of 450.00 for the two of us. Since she is 3, she requires her own ticket.  Finally, we have our return flights back to Wrangell which cost $850.00 for my wife, mother in law, our 3 kids and myself.  Now that we had 2 kids under the age of 2, we actually only purchased 4 tickets, with two “lap infants.”  Finally, we have the actual medical bills associated with the birth.  Although I haven’t seen them yet, we have the “Blue Cross Blue Shield Federal Basic Program” meaning the labor and delivery will only cost us $175.00 out of pocket, plus another $30.00 for the follow up pediatrician visit the day after discharge from the hospital; however this doesn’t include the 5386.16 I pay BCBS annually in premiums for the plan.  This sure beats the $6,000.00+ we paid out of pocket for our first child through the same insurance company, but that’s a topic for another post. So here is what our out of pocket expenses look like for the birth of our child:

1. Airfare: $1,600.00
2. Lodging: 1,600.00
3. Ferry/Ground transportation: $1,000.00
4. Hospital costs: $5386.16+175.00+30=$5,591.16

Total: $9,791.16 

 (food costs were intentionally excluded as we would still have eaten in Wrangell)

Now, for the comparison of what this trip would have cost us had we been on Alaska State Medicaid broken down by expense.

1. Airfare: Alaska Medicaid covers all travel for the patient and one escort to the nearest community which provides the necessary services, in this case, Ketchikan.  So, the initial airfare on Alaska Airlines for my mother in law, wife, and 18-month-old would have been totally covered by Medicaid.  However, I would still have had to cover my daughter and myself for airfare, meaning we would have had a net expense of $450.00 for airfare to Ketchikan.  The same applies for the return trip, which would have cut our return trip in half, for an additional $425.00 bringing total airfare costs to $875.00 out of pocket.
2. Lodging: Medicaid covers all lodging for patients and escorts in Medicaid approved hotels, which in the case of Ketchikan, just happens to be the same hotel we stayed at for the birth of our first two children.  So, in the case of lodging if we were on Medicaid, we would have a net expense of $0.00 on lodging.
3. Ferry/ground transportation:  Medicaid offers travel vouchers or taxi vouchers for all appointments and to/from your hotel meaning we would again have a net expense of $0.00 for our ground transportation as it would be covered with vouchers.
4. Hospital costs: Since Alaska State Medicaid covers all medically necessary expenses, our net expense for hospital/insurance costs would again be, you guessed it, $0.00!!!!

This brings our grand total for out of pocket expenses for the exact same procedure, at the exact same hospital with the exact same staff to a total of $875.00 through Medicaid , which is really only the airfare for my daughter and I to travel to and from Wrangell.  This is compared to the nearly $10,000.00 we actually spent out of pocket to have our child.  But wait there is more!!!!  Since my wife and I file our federal taxes jointly and are in the 24% tax bracket, we had to pay a 24% penalty on those dollars not included in premiums and medical bills since we have healthcare FSAs.  Simply put, we paid a 24% penalty on the 4,200.00 we spent on lodging and transportation that otherwise would have been covered by Medicaid, meaning we had to make over 5k to pay for these expenses.

Simplified: Expenses with Medicaid: $875.00.  Expenses without Medicaid: nearly ten thousand dollars!

What is written above is an actual real-life case study in why it no longer makes sense to work and try to get ahead in the United States.  This one procedure cost us nearly 10k out of pocket, and actually more than that due to taxation of our income used to cover travel and lodging.  I have no problem paying my “fair share” of medical expenses for my family and myself.  My issue is my federal and state tax dollars are used to pay for Medicaid for others, while excluding my family from the exact same program I pay for, simply because I work and pay taxes. It makes absolutely no sense that any individual would be forced to pay for a program for others, which they are then excluded from because they pay for the program.  Hell, even with Social Security we are at least told we will get access to funds in the future in exchange for the taxes we pay today. With Medicaid, you are guaranteed you will never benefit from the program you pay for, unless you get your MAGI under the threshold to qualify for Medicaid through the expansion program.  Exclusion from Medicaid is one of the biggest POS’s you will ever face, second only to taxation.  Unfortunately, this is just life in our quasi socialistic society today and will only get worse thanks to the “progressive left” in our society.  Liberals need to understand that somebody has to pay for all of their social programs, and the simple fact that somebody at my income level is beginning to do the math and discover it doesn’t make finical sense to work full time, it should be a huge wakeup call to our society: if it doesn’t make financial sense for someone making nearly 6 figures to work full time, then it definitely doesn’t make sense for anybody making less than 6 figures to continue to work in the traditional fashion.