Learn more about the Affordable Care Act – the individual mandate: penalty and subsidies

If you can afford insurance but do not get it, you will be charged a fee. This is the “mandate” that people are talking about. Basically, it’s a trade-off for the “pre-existing conditions” bit, saying that since insurers now have to cover you regardless of what you have, you can’t just wait to buy insurance until you get sick. Otherwise no one would buy insurance until they needed it. You can opt not to get insurance, but you’ll have to pay the fee instead, unless of course you’re not buying insurance because you just can’t afford it.

*Note: On 6/28/12, the Supreme Court ruled that this is Constitutional.

 

ViaReddit – What exactly is Obamacare?

 

 

More details from Kaiser Health News:

Q: I don’t have health insurance. Will I have to get it, and what happens if I don’t?

A: Under the legislation, most Americans will have to have insurance by 2014 or pay a penalty. The penalty would start at $95, or up to 1 percent of income, whichever is greater, and rise to $695, or 2.5 percent of income, by 2016. This is the individual limit; families have a limit of $2,085 or 2.5 percent of household income, whichever is greater. Some people can be exempted from the insurance requirement, called an individual mandate, because of financial hardship or religious beliefs or if they are American Indians, for example.

Q: I want health insurance, but I can’t afford it. What do I do?

A: Depending on your income, you might be eligible for Medicaid, the state-federal program for the poor and disabled, which will be expanded sharply beginning in 2014. Low-income adults, including those without children, will be eligible, as long as their incomes didn’t exceed 133 percent of the federal poverty level, or $14,404 for individuals and $29,326 for a family of four, according to current poverty guidelines.

Q: What if I make too much for Medicaid but still can’t afford coverage?

A: You might be eligible for government subsidies to help you pay for private insurance that would be sold in the new state-based insurance marketplaces, called exchanges, slated to begin operation in 2014.

Premium subsidies will be available for individuals and families with incomes between 133 percent and 400 percent of the poverty level, or $14,404 to $43,320 for individuals and $29,326 to $88,200 for a family of four.

The subsidies will be on a sliding scale. For example, a family of four earning 150 percent of the poverty level, or $33,075 a year, will have to pay 4 percent of its income, or $1,323, on premiums. A family with income of 400 percent of the poverty level will have to pay 9.5 percent, or $8,379.

In addition, if your income is below 400 percent of the poverty level, your out-of-pocket health expenses will be limited.

 

Continue reading Learn more about the Affordable Care Act – the individual mandate: penalty and subsidies

Learn more about the Affordable Care Act – summary of Medicaid expansion and costs

Medicaid is the largest health insurance program in the United States.  Presently, Medicaid provides health and long-term care coverage to 59 million individuals.

Under the PPACA (Patient Protection and Affordable Care Act), Medicaid is set to expand its eligibility for coverage to include persons with income levels at or below 133 percent of the federal poverty level. Best estimates place the increase in additional enrollees at 16 million to 18 million.

The purpose behind the expansion of Medicaid under the PPACA is to reduce the number of uninsured in the U.S., an estimated 46 million.  Using analyses provided during the debate leading up to passage of the PPACA, 32 million of the 46 million will gain access to insurance under the new law, half of which will do so via Medicaid.

Assuming a somewhat equal replacement trend (those that fall off Medicaid due to death or change in economic status are replaced by approximately the same number of new eligible enrollees) over the phase-in period set for Medicaid expansion (by 2014), Medicaid will ultimately cover nearly 70 million people.  Per the Congressional Budget Office, the cost of expansion between 2010 and 2019 to the federal government is $434 billion with an additional $20 billion allocable as states’ costs.

 

ViaHealth Reform and Medicaid Expansion

 

 

With an additional 16-18 million people on Medicaid, cost becomes a big issue. Estimates have the total cost of the whole bill (Medicare, Medicaid, etc.) at $828 billion. Take away from that $575 billion in savings from Medicare, and a bevy of new taxes.

Including higher taxes for those making more than $200K, taxes on luxury medical plans, on drugs, on high-cost medical equipment, on indoor tanning salons, and an annual fee to all insurance providers.

Added all together and the Congressional Budget Office estimates a reduction in the Federal Budget deficit, meaning that the PPACA and its increased Medicaid coverage pays for itself and saves money.

Of course, these are all estimates and subject to endless debate.

 

Source: Estimated Financial Effects of the “Patient Protection and Affordable Care Act,” as Amended (pdf)

Continue reading Learn more about the Affordable Care Act – summary of Medicaid expansion and costs