Jun. 28th, 2012

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There has been a lot of back and forth on the issue of the Affordable Health Care Act (AKA Obamacare). Now that the Individual Mandate has been reaffirmed by the US Supreme Court, here are some facts, courtesy of the Kaiser Health News*.

Let's start with the worst case scenario: You can't get affordable coverage and must take the penalty hit. Even in that case, things aren't horrible.

No penalties will be in effect until after January 1, 2014. Even then, the annual penalty will be set at 1% of annual income or $95, whichever is greater. This amount will gradually increase, reaching a maximum of $695 or 2.5% of annual income, again whichever is greater, by January 1, 2016. Note that the penalty is *per individual*, but there is a maximum per family of $2,085 or 2.5% of annual income, whichever is greater.

tl;dr: No one will ever pay a penalty more than $2,085 per family 2.5% of their family's annual income per year. (Kaiser Health News, March 22, 2010)

But really, I suspect most of us would rather have insurance coverage -- the problem is finding something that's actual *coverage* and that we can afford. The Act provides for a sliding-scale subsidy program. Under the program,

1) Medicaid coverage will be expanded to cover individuals and families at or below 133% of the federal poverty level. As of 2012, these are: $11,170 for an individual, $15,130 for a couple, and $23,050 for a family of four. So Medicaid would cover an individual making $14,856, a couple making $20,123, or a family of four earning 30,656.(Dept. of Health and Human Services, 2012 Federal Poverty Guidelines)

2) For those earning 133%-400% of the poverty level ($14,856-$44,680 for individuals, $20,123-$60,520 for couples, $30,656-$92,200 for family of four), a sliding-scale subsidy will be available to offset the cost of premiums. This is the bit I like the most: The subsidy won't be something you have to ask for on your year-end taxes; it will be implemented as a cap on your annual premium. Wikipedia has the chart, but to save you the trip, a family of four at the 150% income level would be paying at most $1,383/year in premiums (after adjustment for poverty line cut-off since the chart was made). At the top of this category, a family of four earning $92,200 a year would be paying at most 9.5% of its income in premiums, or $8,759.(Kaiser Health News, March 22, 2010)

tl;dr: If you're making under $44.5K/year as an individual or under $90K/year as a family of four, you'll be paying at most $4,225 (individual) or $8,759 (family) in annual premiums. In many cases much less than that.

3) For those at or below the 400% income level, out-of-pocket costs will also be limited, but I haven't seen much detail on how or how much.

*The article I'm pulling this from is a tad dated, so if you're aware of changes that have taken place since then, please let me know and I'll correct the post.

The full text of the Affordable Healthcare Act is NINE HUNDRED FIFTY FIVE PAGES of dense legalese, but here ya go. Just in case you have a week or two to kill :)

Last updated June 28, 23:09 EDT


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