How Health Insurance Matters to Your Home Purchase

NEW YORK (TheStreet) -- So you're thinking of buying a home? Congratulations! Here's how to start: Take a tour through the much-maligned Obamacare health insurance website.

That may not seem intuitive, but the your decision on what to spend for a home could be affected by the potential cost of health insurance -- a shocking cost for many.

Now that the site is running fairly well, it's pretty easy to get a rough idea of the cost of health care if you had to go it on your own. Most people probably won't bother to look, because most are insured through work.

But what if your employer canceled its health insurance program? Or what if you lost your job? A small family could easily end up spending $10,000 to $20,000 a year in monthly premiums and deductibles. If that happened, you might be sorry you'd taken on a big mortgage.

For a ballpark view of insurance costs, go to the Healthcare.gov site and click where it says "See Plans Before I Apply." You can get a list of available policies and prices by answering just a few questions on where you live and the ages of family members. It just takes a couple of minutes and does not require that you commit to sign up for a plan or even reveal your name.

You will see a range of options that generally come down to a paying a high monthly premium and having low out-of-pocket expenses, or having a low premium and potentially high expenses. A very healthy family might be wise to opt for a low premium, while a family facing ongoing medical issues could do the opposite.

The key is to calculate the maximum you might pay in a year under the worst case. That would be the maximum out-of-pocket plus the monthly premium. Once you've narrowed the list to policies that seem to suit you, look deeper to be sure they cover all the expenses you could face.

The tricky part, of course, is to guess how often you might face these maximum charges. With a serious illness such as cancer you could face maximum out-of-pocket expenses every year. Even a young, healthy family could have monumental charges after an accident.

Keep in mind that if you suddenly needed health insurance because of a lost job, your lower income might qualify you for a government subsidy. The website has guidance on that as well.

So if you had to pay maximum expenses year after year, could you get by on your income, or would you have to invade your savings for retirement and college?

If maximum health costs would be catastrophic, think about trimming other expenses, especially any you'd be locked into paying, such as a mortgage.

Exploring the Obamacare site can be pretty frightening. The Affordable Care Act guarantees that everyone can get insurance, and ensures that you could keep it after getting sick, but it does not make health insurance cheap.

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