Mary Lou Retton’s explanation of health insurance takes some somersaults

Former Olympic gymnast Mary Lou Retton spoke out last week on NBC’s "Today" show about what she said was a rare pneumonia that almost killed her and resulted in an expensive, monthlong hospital stay.

It was a shocking reveal. One key comment jumped out for people who follow health policy: Retton said she was uninsured, blaming that lack of coverage on 30 orthopedic surgeries that count as "preexisting conditions," a divorce and her poor finances.

"I just couldn’t afford it," Retton told host Hoda Kotb, who did not challenge the assertion.

Retton, who after winning the gold medal in 1984 became a well-known figure — "America’s sweetheart," appearing on Wheaties boxes and claiming a variety of other endorsements — did not provide details of her income, the illness, the hospital where she was treated, or the type of insurance she was seeking, so it’s hard to nail down specifics.

Nonetheless, her situation can be informative because the reasons she cited for not buying coverage — preexisting conditions and cost — are among the things the Affordable Care Act directly addresses.

Under the law, which has offered coverage through state and federal marketplaces since 2014, insurers are barred from rejecting people with preexisting conditions and cannot charge higher premiums for them, either. This is one of the law’s most popular provisions, according to opinion surveys.

The Affordable Care Act also includes subsidies that offset all or part of the premium costs for the majority of low- to moderate-income people who seek to buy their own insurance. An estimated "four out of five people can find a plan for $10 or less a month after subsidies on HealthCare.gov," Health and Human Services Secretary Xavier Becerra said in a written statement when kicking off the annual open enrollment period in November.

Subsidies are set on a sliding scale based on household income with a sizable portion going to those who make less than twice the federal poverty level, which this year is $29,160 for an individual, or $60,000 for a family of four. Premium costs for consumers are capped at 8.5% of household income.

Still, "we know from surveys and other data that, even 10 years on, a lot of people are unaware there are premium subsidies available through ACA marketplaces," said Sabrina Corlette, co-director of the Center on Health Insurance Reform at Georgetown University.

Those subsidies are one of the reasons cited for record enrollment in 2024 plans, with more than 20 million people signing up so far.

To be sure, there are also many Americans whose share of the premium cost is still a stretch, especially those who might be higher on the sliding subsidy scale. Looking at the KFF subsidy calculator, a 60-year-old with a $100,000 income, for example, would get a $300 monthly subsidy but still have to pay $708 a month toward their premium, on average, nationally. Without a subsidy, the monthly cost would be $1,013.

And even with insurance, many U.S. residents struggle to afford the deductibles, copayments, or out-of-network fees included in some Affordable Care Act or job-based insurance plans. The act does offer subsidies to offset deductible costs for people on the lower end of the income scale. For those with very low incomes, the law expanded eligibility for Medicaid, which is a state-federal program. However, 10 states, including Texas, where Retton lives, have chosen not to expand coverage, meaning some people in this category cannot get Medicaid or Affordable Care Act subsidies.

"If her income was below poverty, she could have been caught in the coverage gap," said Larry Levitt, executive vice president for health policy at KFF. 

Attempts to reach a representative for Retton were not immediately successful.

One last point — Affordable Care Act enrollment generally must occur during the annual open enrollment, which for 2024 plans opened Nov. 1 and runs until Jan. 16 in most states. But Retton provided no details on what kind of health insurance she shopped for, or when. And there are types of plans and coverage, for example, that fall outside of the act’s rules.

Those include short-term plans, which offer temporary coverage for people between jobs, for example. There are also coverage efforts dubbed "health care sharing ministries," in which people pool money and pay one another’s medical bills. Neither is considered comprehensive insurance because they generally offer limited benefits, and both can exclude people with preexisting conditions.

If she was considering insurance during a time of year that wasn’t during the open enrollment period, Retton might have still been able to sign up for an Affordable Care Act plan if she met requirements for a "special enrollment." Qualifying reasons include a residential move, loss of other coverage, marriage, divorce and other specific situations.

Retton excelled in landing difficult moves as a gymnast, but she may have missed the bar when it came to buying insurance coverage.

"You can be a very successful person in your other life and not understand American health care and get into a situation that maybe you could have prevented," said Joseph Antos, a senior fellow at the American Enterprise Institute.