Obamacare is a touchy subject. Those that have been outspoken against it either “hate poor people” or are racist. I heard a comedian the other day say that he wasn’t sure how anyone could be against everyone having health insurance. I’ve heard people say that it’s all going to be free. I’ve also known people that do not care one bit either way. All those people are wrong.
So, here it is. The things you need to know about Obamacare.
1- Congress Exemption
You may have heard this mentioned (and maybe debunked because they are not technically exempted - they just don't have to pay for it like we do). In 2009, a Republican introduced an amendment that required Congress & staff to also use the exchanges. Democrats, earlier this year, asked for an exemption. The Office of Personnel Management stepped in and now Congress and staff will receive federal subsidies even if they purchase using exchanges (which no other American is allowed to do).
2- Number of Uninsured
Currently, the number of uninsured Americans is around 55 million. The Congressional Budget Office projected in May that the number of uninsured Americans would be 30 million from 2016 and on. (Author’s note: This law is a huge headache that will have devastating consequences – unfortunately, it won’t even reduce the number of uninsured by half.)
3- Cost
This one is fun. The IRS estimates that a family plan (for a family of 4) will cost around $20,000 per year by 2016.
4- Penalty
If you cannot afford insurance or do not wish to purchase it, you will be required to pay a penalty fee/tax… whatever they’re calling in now. This penalty will be a flat dollar amount (which will be $695 in 2016) or a percentage of your household income (which will be 2.5% in 2016).
5- Employer-provided Insurance “Glitch”
This is called a “glitch” even though it wasn’t something that was overlooked, but rather a conscious effort to try to save money with this program. Any family making 400% of the poverty line will receive a subsidy UNLESS one of the family members has employer-provided insurance. So, what that means is: If dad gets insurance through work, mom and kids cannot receive subsidies to help pay for theirs so it will be full price. (*points to #3 above*)
6- Devastating Effects on the Economy
In July of this year, the United States Chamber of Commerce did a survey of small business owners. Under “challenges facing small business owners today,” the highest ranking answer was “2010 healthcare bill” at 49%. (Note: this was not a survey where businesses chose one over the other, so the total amount does not equal 100%) The other top choices were “over-regulation” and “economic uncertainty” which tied at 44%.
Among small businesses affected by the employer mandate, one half of those surveyed will cut hours of full-time employees or replace full-time employees with part-time ones to avoid the mandate. Twenty-four percent said they will reduce hiring to stay under 50 employees.
7- Hitting Your Wallet
Other than premiums, there are a few ways in which Obamacare could potentially cost you money. John Kartch, director of communications at Americans for Tax Reform, wrote in 2012 of the following items: Medical Device Manufacturing Tax (2.3% tax on manufacturers), High Medical Bills Tax Deduction Increase (before you could get a tax reduction if your out-of-pocket expenses were more than 7.5% of your adjusted gross income – now it is raised to 10%), Flexible Spending Account Cap (forced to cap at $2,500 annually), Obamacare Surtax on Investment Income (uh. Not really sure why this is in there), and Medicare Payroll Tax Increase.
This list is definitely NOT exhaustive. I just didn’t want this post to end up as long as the legislation itself.
Until next time,
L
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