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Tag: Obamacare Subsidies

Obamacare Penalties Ahead for Many Tax Filers

Uncle Sam could take a bigger bite at tax time for consumers who received too much government help last year with their Obamacare premiums.

That may be just one of several surprises for millions of Americans in advance of the first tax deadline involving the Affordable Care Act.

The majority of Americans who get their health insurance at work should see few changes when filing their taxes. Most will just need to check a box on their tax return indicating they had coverage in 2014.

It stands to be more complicated for those individuals who purchased a private health plan in government-run exchanges or went without insurance at some point last year.

Obamacare launched a year ago, but it’s only now that people will incur tax penalties for being uninsured. Others will realize their federal premium subsidy was incorrect.

Experts project that 40% to 50% of families that qualified for financial assistance might have to repay some portion because their actual household income for 2014 was higher than what they estimated during enrollment.

Those repayments could range from a relatively small amount to thousands of dollars in some cases. In California, some of the first clues may emerge later this month when the state issues tax notices to 1 million consumers.

About 85% of the roughly 7 million Americans who signed up last year through government-run exchanges paid discounted premiums thanks to subsidies.

Read the full article here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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Eligible Americans Turn Down Obamacare Tax Credits

Grace Brewer says she never thought she would be without health insurance at this stage of her life. “I’m a casualty of Obamacare,” says Brewer, 60, a self-employed chiropractor in the Kansas City, Kansas, area.

She wanted to keep the catastrophic health insurance plan she once had, which she says fit her needs. But under the Affordable Care Act, the government’s health care reform law, the plan was discontinued because it did not comply with the law’s requirements, and her bills doubled to more than $400 a month. “I wanted a minimal plan and I’m not allowed to have it,” she says. “That seems like an encroachment on my freedom.”

The Affordable Care Act requires everyone to buy insurance or pay a penalty. Government subsidies can reduce costs for low- and middle-income Americans and without them, many say they could not afford insurance. Americans qualify for subsidies if they are under the age of 65 and have an annual income of up to $46,680 as an individual, or up to $95,400 for a family of four.

Though Brewer could pay less for a plan if she were to accept a subsidy from the federal government, she refuses. “I want to pay my own way,” she says. “I will not take a handout.”

Her sentiment is unusual, but brokers say they do hear from clients who are eligible for subsidies – which are based on household income and not assets – but want no part of them. Health officials have been boasting that 6.6 million people have enrolled in health coverage through state or federal marketplaces created under the Affordable Care Act, but in sharp contrast stands a small group of Americans who say they want nothing to do with the plans, even if they would save money. Their reasons vary: Some are protesting Obamacare, while others simply feel it’s unethical to accept taxpayer dollars to pay for health insurance.

“It’s almost a philosophical or political statement,” says Gerry Wedig, a professor at the University of Rochester’s Simon Business School.

For Brewer, buying a plan on her own would mean she would not have enough to pay for housing, she says, so she chose not to be insured this year and will have to pay a penalty in her 2016 tax filing that is likely to be 2 percent of her income. She has no dependents, is healthy, does not use prescriptions and says she has been careful about her health choices, not overusing medical care.

“I am frustrated. I am angry. And I say ‘no’ to the exchanges,” she says. “Somebody has to stand up and this is the only way I can do it. I will not be signing up under duress. I’m taking care of myself.”

Read the full article here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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Court Case & New Congress: What’s Next for Obamacare?

The newest round of open enrollment under the Affordable Care Act has begun, just as the law comes under a new threat with the Supreme Court’s decision that it will hear a new challenge questioning its government subsidies. The case raises the stakes for HealthCare.gov too; the last thing the Obama administration needs is a repeat of last year’s embarrassing technical glitches. On the flip side, the lawsuit could have an important political effect: It could give GOP leaders Mitch McConnell and John Boehner leeway to avoid dealing with the issue of health care right away. By having a court case to point to, Republicans could delay the health care showdown between their party and the White House – and even one within the GOP itself.

The stakes are high, especially after Democratic losses

Congressional midterm losses aside — when it comes to health care, Democrats might be even more stung by the party’s big losses in governors’ mansions and state legislatures on Election Day. Democrats were counting on a few more gubernatorial wins, which would have boosted the number of states expanding Medicaid or starting state exchanges. The more folks who are insured through ACA, the more entrenched the law becomes – which in turn makes it harder to dismantle. In theory, public pressure isn’t supposed to have an impact on Supreme Court decisions, but the difference between a smooth rollout and a bad one in the law’s second open enrollment period certainly impacts how difficult it would be to gut the law in the future.

Read the full article here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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Supreme Court Takes Obamacare Case

In a Wow moment, the Supreme Court announced on November 7th, that they will take one of the four pending “Halbig” cases––specifically King v. Burwell.

The issue is over whether the new health law actually authorizes the payment of premium subsidies in the 37 states that will rely upon the federal government to run their exchange in 2015.

This effort is being made on a number of fronts but has been generally know as the “Halbig” challenge. I guess we will now call it the King challenge.

If the Supreme Court eventually affirms this challenge, anyone receiving a health insurance subsidy in the 37 states run by the feds would immediately lose it. Given that the bulk of those currently getting subsides are at the lower income range for those subsidy eligible, most would likely drop their Obamacare insurance unless they were so sick it made sense for them to beg, borrow, or steal the money they would need to continue making premium payments.

The result would be a much smaller Obamacare insurance pool disproportionately filled with sick people.

Read the full article here.

Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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Self-Employed Workers’ Big Concern About Obamacare Subsidies

Question: In 2013, my husband and I were both employed and had company-provided health insurance. In 2014, we are both unemployed and starting our own business. We’re not sure what kind of income we’ll bring in this year so we’re not sure how to figure out if we qualify for Obamacare subsidies. Our 2013 income will be too high to use as an estimate. Also, if we qualify for large subsidies, can we take them now and then reduce them later if our business takes off and we make more than expected? This seems like an obvious concern for many self-employed people.

Answer: This is indeed a large concern and it is particularly tough for you, since first-year business income can be wildly unpredictable. Even for the long-term self-employed, the uncertainty around estimating income to determine eligibility for subsidies is one of the major complications of signing up for state and federal Affordable Care Act marketplaces, oftentimes called Obamacare exchanges.

Basically, as I explained last year, Affordable Care Act subsidies are available on a sliding scale to individuals making up to about $45,000 annually and four-person households bringing in about $94,000. The idea is to help reduce the out-of-pocket cost for insurance, since it is now mandatory.

Read full article here.

Contact Steven Cosby with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.

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