October Questions Submitted by our readers
What is Obamacare, and what is so great about it ?
“Obamacare” is the short name that most people used when referencing the Patient Protection and Affordable Care Act. The Patient Protection and affordable Care Act also goes by ACA, Health Care Reform, and PPACA. The law was passed and signed by president Barack Obama on March 23, 2010. Based on estimates by the CBO (Congressional Budget Office) the law is expected to cover 48 million Americans who are currently under insured, or uninsured. Many facets of the law are already in place. All new plans will now provide guaranteed coverage even for individual with pre-existing medical conditions. Banning of lifetime, and annual caps, Insurance companies cannot rescind insurance for a member they’ve run up a large medical bill, among other benefits. There are also various provisions in the law to protect individuals. Under the law, women can’t be charged higher rates than men, Older individual can be charged more than 300% of what a younger person would pay.
Why is it called “Obamacare?”
The name Obamacare was first started when republican in the house and senate who opposed the law used the term an insult. However the president embraced the name Obamacare, and started using it himself. Over the last three years the general public has referred and are generally call the law Obamacare. However various surveys and studies have found that people are more favorable when the term “Patient Protection and Affordable Care Act” is used rather than Obamacare. CNBC conducted a poll and found when asked about “Obamacare,” more claimed they a) knew what the law was and b) did not support the legislation. In total, 29 percent of those polled were in favor of Obamacare, 46 percent were against, and 12 percent were unaware of what that was. On the flip side, when asked about the “Affordable Care Act,” 22 percent supported the initiative, 37 percent were opposed to it, and 30 percent were unaware of what that was.
What do I need to do?
About 80% of Americans will not need to do much. Since most American who currently gets health insurance from their employer, will not need to do anything. If you have Medicaid, Medicare, or enrolled in a government program you do not have to do anything. If you still have questions reach out to your HR person. But most likely if you have a HR person to reach out to, and have a health plan the exchanges will not apply to you.
What’s a health insurance exchange?
The Health Insurance Exchange, and the Health Insurance Market Places are the market places created to allow those without health insurance to purchase and shop various plans. The state or the federal government will either manage these exchanges. Additionally the health insurance exchanges/Market places are also the main way for people who are eligible for subsides to get help paying for their coverage.
How much will it cost to buy a health plan on the Health Insurance Exchange?
-Las Vegas, NV
There are various factors that will play a role in the cost of Health Insurance premiums on the exchange. Recently the department of HHS release some averages across the United States. Where the national average price for a high-deductible plan is $249 a month, not counting subsidies — but coverage like that would cost $144 in Minnesota and $425 in Wyoming. Currently the factors that effects rates, includes age, geographic location, family size and, sometimes, tobacco use. Many individuals will be able to receive subsidies or will be able to get Medicaid if their state allows it.
What are Subsidies, and who gets them?
Subsides are financial assistance provided to anyone who is uninsured and the cost of their health plans is grater than a certain percentage of their income. If you choose to take the credit in advance, the government will send money straight to your insurance company to cover the portion of your premium your eligible for, additionally you can pay the full cost of the insurance premium upfront and claim the credit when you file your taxes. Use our subsidy calculator to get an estimate what you maybe eligible for.
What is the Individual Mandate?
The IRS in conjunction with the department of HHS has stated most legal U.S. resident must get health coverage or pay a tax penalty. The IRS calls this the Individual Shared Responsibility fee, while most American call this the Individual Mandate. This requirement is put in place to make sure Health Insurance Companies are not facing an adverse selection process where only sick and unhealthy people are part of the exchange. This will also spread the risk across a bigger field of individuals that are both sick and healthy. If you already have health insurance you do not have to worry about this mandates. Additionally there are various exemptions put in place that will exempt you from paying the Individual Shared Responsibility fee. Use Individual Shared Responsibly calculator to determine your potential fee amount.
How much is the individual mandate fee?
The fee describe above starts at $95 or 1 percent of your income, whichever is higher, The penalty continues to rise in 2015 and 2016, ending up at $695 or 2.5 percent of income, after 2016 it will increase with the rate of inflation. The IRS provides more details on this on their website. The fee will be assessed based on the months you go without coverage. The IRS will take the amount out of your taxes starting in 2015 when you complete your taxes. Note: The IRS cannot come after you if you don’t pay it nor will you go to jail over it. Interest fess, and penalties may accrue year over year.
If I purchase a plan on the Obamacare exchange can I keep my current doctor ?
The law does not dictate whom you pick as a doctor, however different insurance policies have different doctors that are “in-network” or “out-of-network.” When choosing a policy it is very important to ensure that your doctor is in the network of whatever policy you get, or expect to pay more to visit her. However as part of the Narrow Networks system being established by Health Insurance Companies providing plans on the exchange. Many of the health plans sold in the market place will have fewer choices of providers than those typically offered by employers.
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