On Thursday, June 28, the U.S. Supreme Court said the Healthcare Overhaul (The Affordable Healthcare Act or AHA) was constitutional. Now everyone in the media has an opinion about it. Some saying it was a great decision, while others say it was an awful decision, but the question most people are asking is, “How does this affect me?” A bit fewer ask, “Is this opinion really as bad or good as everyone else says?”
For this post, I will strive to answer the first question. First, I’m going to break down what this decision means for a typical person. Then, in my next post, you can read my take on what the Supreme Court did in this case.
Anytime someone hears about some supposedly large event occurs like NASA discovering a new planet or someone stumbling across a new medication for an obscure disease, the first thoughts is, “So what?” Same goes for this decision. What does it mean for number one, me?
Well, if you are a single person with regular and continuous health insurance through your job, guess what, not much happens. Some caveats:
• If you have a Flexible Spending Account, the most you can put away will be $2,500 in 2013.
• If you have kids under the age of 26, your health insurance can’t deny them coverage (if you have Humana or United Healthcare, they were going to do that regardless of the Supreme Court’s decision).
• If you work for a company that has fifty or more employees, they have to offer you health insurance or pay a pretty heft fine.
• If you have preexisting conditions, in 2014, they can’t be used to deny you coverage.
But what about my taxes? Am I going to now be paying more to the Feds to ensure everyone has health insurance? The Congressional bean counters estimate the Federal government is going to be paying somewhere in the ballpark of $1 trillion to pay for all of this. Won’t this make my taxes go up?
Well, you would think, “But those same bean counters at the Congressional Budget Office estimate government deficits will actually go down over the next twenty years, meaning revenue will go up compared to expenses. How do they figure that?” Ask them. It doesn’t seem intuitive, but they might be able to make more sense of their numbers.
Finally, we come to the big question. What if you don’t have any type of health insurance in 2014? Well, this is what the hullabaloo at the Supreme Court was about.
• If your income is less than 133 percent of the federal poverty line, you will qualify for Medicaid through your state (that is, if your state decides to participate in the Medicaid expansion. Write your state representative).
• If your income is low enough to exempt you from paying any federal income tax and you don’t have health insurance, there is no financial penalty.
• If you don’t fit into the two categories above and don’t have insurance, then in 2014, you have to pay at least $285 or one percent of household income for that year, whichever is higher.
• Then in 2016 you have to pay at least $695 or 2.5 percent of income ($60 a month if you make $35,000 a year, or $200 a month if you make $100,000 a year), but know that you will never pay more than what an approved insurance plan would cost, projected to be about $400 a month.
If you have any questions about these issues, send me an email to mkochanowicz@gmail.com, and I would glad to answer any inquiries. In a few days, be on the lookout for my breakdown of the Court’s reasoning.
