OBAMACARE IN A NUTSHELL

I PERSONALLY THINK IT IS GREAT IDEA.  ANYTHING NEW WILL HAVE ITS UPS AND DOWNS, BUGS TO WORK OUT ETC.  IT STARTS ON OCTOBER 1, 2013.

Approximately 44 million Americans are without health insurance. It is anticipated that 7 million citizens will lose their job-based insurance in the near future. The following is Obamacare basics in a nutshell.

Obamacare includes reforms to both the health care and the insurance industries. These changes are anticipated to take place over the next several years.

It includes measures that enable most U.S. citizens to afford to pay for private insurance. By 2014, you are required to purchase your own “government-approved” health insurance, if health insurance is not offered by your employer, or pay a tax penalty.

Based on your income, you either qualify for Medicaid (family of four with an annual income of $23,050), get assistance to pay for insurance (family of four with an annual income of $92,200) or you do not quality for any assistance (health insurance plan costs less than 8 percent of your annual income).

Those who cannot afford insurance, families between 100-400 percent of the poverty level, gain payment assistance through exchanges.

What, you may ask, are exchanges? Exchanges are like coupons or rebates (online market place) to help offset the cost of your health insurance.

What is the penalty should you chose not to purchase health insurance? An annual fee ranging from $95-$695. This penalty depends on your income (can be as high as 2.5 percent of one’s annual income by 2016) and will be phased in over the next three years, starting in 2014. This will be paid at tax time.

Obamacare will impact employer provided medical coverage significantly. Based on the number of full-time employees, businesses may be required to offer their workers health insurance. Companies with over 200 full-time employees must automatically enroll their workers in health insurance plans.

If a business has fewer than 50 full-time employees, the employer may chose to offer insurance. If the employer does not offer insurance and has even one employee who qualifies for insurance subsidies, the employer will be taxed $2,000 annually for each employee over 30 employees who qualifies for the exchanges. Employers with fewer than 50 workers are exempt from these penalties. Employers who want to provide health insurance to their employees may qualify for tax credits and may be eligible to use the health insurance exchange (opens Oct, 1, 2013) to pay for the health insurance premiums.

The hope is that by 2022, the Affordable Care Act will have expanded coverage to 33 million Americans who would otherwise be uninsured. It is expected to cost $1.1 trillion over the next 10 years. The Congressional Budget Office claims this will reduce our nation’s deficit by $143 billion.

Patients frequently ask me what I think about Obamacare. Certainly, there are good points to this legislation, for example, allowing young adults under age 26 to remain on their parents’ insurance plan, prohibiting insurance companies from denying coverage due to “pre-existing conditions” or from dropping you once you become ill, and providing coverage for preventative services.

I think Obamacare will greatly help working Americans who cannot afford insurance but do not qualify for Medicaid. Unfortunately, there certainly will be a price to pay for providing “affordable quality” health care.

This may come in the form of taxes (over 20 new taxes to be phased in through 2018), less access to physicians (who will be taking care of the million newly insured in the face of projected doctor shortages), or worse, cause a halt in job growth (employers may be less likely to hire individuals from low income households or less likely to hire full time workers at all).

Our current health industry is terribly flawed. The optimist in me hopes that the Affordable Care Act will improve the delivery and breadth of health care; the skeptic and realist in me, however, does not see Obamacare as the solution. Time will certainly tell.