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General News    H3'ed 7/10/13

Implementing Obamacare: The Fine Print (Carol's Story Sidebar)

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Message Trudy Lieberman
Re-printed with the permission of the Columbia Journalism Review

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See also Accompanying article:  "Carol's story: One woman tries to navigate the Obamacare insurance jungle"

Who's eligible?

Generally, people who do not have coverage otherwise--from an employer, Medicare, Medicaid, the Children's Health Insurance Program (CHIP), or the military--can buy insurance in an exchange and get a subsidy to help pay the premium. Those who are eligible for coverage through other routes can also buy insurance through the exchanges, but are not eligible for subsidies.

Two other categories should be noted:

If you think your employer coverage is inadequate "-If that coverage meets certain government tests but the employee feels it is still not good enough, she can shop in the exchange, but is not eligible for a subsidy.

If what you have to pay for employer coverage is out of your price range Workers who pay more than 9.5 percent of their adjusted gross income for employer coverage can buy a policy in the exchange for themselves or their families--or both--and get a subsidy. (A problem arises, however, when a worker's contribution to an individual policy is less than 9.5 percent of income, but the contribution to a family policy is more than that. Family members in this situation are currently not eligible for subsidized coverage from the exchanges.)

When families are not eligible for subsidized health insurance, where are they going for coverage?

The penalties

People who don't buy the required insurance can expect to pay tax penalties, as follows:

--In 2014 "-$95 per person, or no more than 1 percent of taxable income
--In 2015"-$325 per person, or 2 percent of the taxable income
--In 2016 and beyond"-$695 per person or 2.5 percent

Families with low incomes will generally pay the flat amount, while those with higher incomes will pay a percentage of their income in 2016.

There will be a maximum penalty, figured in this way: one full penalty per each adult in the family, and an additional half an adult penalty per child--but the total penalty cannot exceed $2,085 if the penalty is a flat rate. If it is a percentage of income, it can't exceed the cost of a bronze plan, the cheapest type of policy in the exchanges.

Will some people find it cheaper to take the penalty then buy insurance?

The jargon

Deductible "-the amount someone pays out-of-pocket before insurance begins to pay. This is usually lower for in-network providers than for those out of network.

Copayment "-a set amount paid for a particular medical service or drug. Historically they have been low, but in the last year or so they have been rising for certain services.

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Trudy Lieberman, a journalist for more than 40 years, is a contributing editor to the Columbia Journalism Review where she blogs about health care and retirement at www.cjr.org. Her blogposts are at http://www.cjr.org/author/trudy-lieberman-1/ She is also a fellow at the Center for Advancing Health where she blogs about health at (more...)
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