No, Jason Chaffetz, Paying for Health Care Is Not Like Buying an iPhone

Congressman is right that Americans have choices – but whether to buy a new phone or health insurance isn't one of them

"Maybe, rather than getting that new iPhone that they just love and they want to go spend hundreds of dollars on that, maybe they should invest in their own health care," Jason Chaffetz said Tuesday morning in a conversation about the GOP House's new health care bill. Credit: Andrew Harnik/AP

Utah Rep. Jason Chaffetz set off a social media firestorm Tuesday morning when, during a CNN appearance to stump for the House Republicans' plan to repeal and replace the Affordable Care Act, he compared health care spending to the decision to purchase an iPhone.

"You know what, Americans have choices. And they've got to make a choice," he said. "So maybe, rather than getting that new iPhone that they just love and they want to go spend hundreds of dollars on that, maybe they should invest in their own health care."

The outrage was immediate.

I've devoted a good chunk of the past decade to disputing the myth that Americans are wasting their money on frivolities like cell phones – which aren't such a frivolity anyway, but more about that in a minute – while complaining about the cost of health care and other necessities. I wrote a book called Pound Foolish about it, plus many blog posts and this Twitter thread. It's a moralistic trope – a sort of Ayn Randian bit of self-determinism combined with the idea that people who are lesser (think less monied, browner or female) don't deserve nice things.

And like the villain in a horror movie franchise, it doesn't matter if you shoot it, drive a stake through its heart or otherwise blast it to oblivion. It comes back again and again and again.

The wealthy have complained about how the poor spend their money since time immemorial, but the modern era begins in the 1990s. Almost as soon as Starbucks went national, people began opining that people were wasting their money on coffee when they could be putting it in the bank. It was more than a trifle ironic: Those who study the coffee trade say slackers who were unemployed in the terrible economy of the early Nineties flocked to coffee houses because they were cheaper than bars. But don't let facts stop you from judging folks when they're down!

Soon enough, a book called Smart Women Finish Rich, written by financial adviser David Bach, laid out the case that if people ceased spending $5 a day on a latte and muffin at Starbucks, or other unnecessary small luxuries, they could retire millionaires. Then Oprah took up the cause. "What if one of the country's leading financial experts told you for sure that even if you've got credit card debt, even if you are struggling from paycheck to paycheck, that by the end of this hour you will know the secrets to turning your money into millions automatically?" she asked her excited audience. The "Latte Factor" had become a cultural phenomenon.

Since then, it's become common to see guests and hosts on cable news opine about Americans wasting their limited funds not just on coffee, but on big-screen televisions, smartphones and other things. Nothing is too small to attract attention. Earlier this year, a New York Times article claimed people receiving food stamps were spending 9.3 percent of their food budgets on soda. In fact, that figure turned out to comprise all sweetened drinks, not just soda ­– and households that don't receive food stamps spend not all that much less.

The problem with harping on the cost of small items is that doing so ignores the realities of modern American financial life. According to Sentier Research, median household income in January of 2017 was more than one percent lower than it was in January of 2000. At the same time, the out-of-pocket costs of someone with employer-provided health insurance have increased by more than 50 percent since 2010, and childcare costs have gone up at double the rate of the consumer price index since 2009. As for the Affordable Care Act? Well, as it turns out, about 90 percent of those using it will select a plan with an individual deducible of $1,300 or higher, or $2,700 for family coverage. As for someone with employer-provided insurance, the Henry J. Kaiser Family Foundation reports that their average deducible is just over $1,200 annually. And medical costs are notoriously opaque and all but impossible to predict: A 2015 survey by Consumers Union found that just under a third of those with private health insurance received a surprise medical bill within a two-year period.

Moreover, it's questionable how much of a luxury a smartphone actually is. In a world where it's perfectly legal to demand fast-food and retail workers be available to report to work on a few hours' notice, woe to the employee who isn't easily reachable. And as computers become more and more critical to our daily lives, it's hard to question wanting a lower-cost one, which is what an iPhone is, essentially.

As it happens, around the time Chaffetz was mouthing off on CNN, I received a COBRA bill – it amounted to just under $1,800 for the month for my family of four, with an annual deductible of $2,500. A new iPhone costs less than $700. So I could buy two iPhones a month for what it costs to insure my family.

Americans might have choices, as Jason Chaffetz says – but whether to buy a new cell phone or have health insurance isn't one of them.