You may have heard about the insurance-premium “sticker shock” that some say is coming in January 2014, when all Americans will be required to carry some sort of health insurance, according to the Affordable Care Act (ACA; aka Obamacare). But some reassuring news came out last week from FamiliesUSA, a health advocacy group, showing that the majority of people who can receive tax credits to help offset the cost of their new premiums under the law are between the ages of 18 to 34. If that’s you, you should be feeling some relief—both that you’ll have insurance (if you don’t already) and that it isn’t going to be at some crazy-high rate you can’t afford.
More good news came out last week from the Kaiser Family Foundation too: The group put out briefs on programs being set up by every state to help people figure out which coverage is best for them. In short, these should help demystify the whole process of getting enrolled under Obamacare.
You definitely won’t be alone if you need a little help paying for your insurance. FamiliesUSA reported that nearly 26 million Americans will be eligible for new premium tax credits in 2014. And those with an annual income between $47,100 and $94,200 (for a family of four; incomes between 200 and 400 percent of the federal poverty level) will make up about 56 percent of those eligible for the tax credits.
FamiliesUSA also reported on the demographics of who can use the tax credits: About 58 percent of Americans who’ll be eligible for the premium tax credits will be white, non-Hispanics; about 11 percent will be black, non-Hispanics; and about 23 percent will be Hispanic. Other races make up about 8 percent of those eligible to receive credits. “The tax credit subsidies are a game-changer,” said Ron Pollack, executive director of Families USA, at a press conference. “They will make health coverage affordable for huge numbers of uninsured families who would have been priced out of the health coverage and care they need.”
Health advocates like Pollack hope that by spreading the word about the tax credits, more people will look into their options and enroll. One executive of a county in the northeastern U.S. interviewed last week said he’s concerned that consumers—especially younger ones—may decide that the penalty for not enrolling is less expensive than paying for coverage, leaving them vulnerable to debts if they face a medical emergency.
According to the Department of Health and Human Services, which administers the ACA, in 2014, people who can afford to but do not purchase health insurance will pay a penalty, which will be collected by the IRS. For an individual, the tax starts at $95 a year or up to 1 percent of income, whichever is greater. By 2016, that rises to $695 per individual or 2.5 percent of income.
In a recent briefing in Washington, D.C., the Kaiser Family Foundation stressed that there are places to go if you’re confused about how to enroll and buy insurance—though there still remains a lot of confusion about this. “It’s not an automatic assumption that [people] will know how to enroll,” said Karen Pollitz, a senior fellow at the Kaiser Family Foundation, who spoke at the briefing.
According to Kaiser, even with all the digital tools being developed, such as state health insurance marketplace websites and online application forms, one-on-one consumer assistance will still play a key role in helping people understand their obligations and choices. A recent Kaiser poll showed that two-thirds of the uninsured, and a majority of Americans overall, say they have too little information on how the ACA will affect them.
While health “navigator” programs are required in every state under the ACA beginning in 2014, some of these may take a while to start up, and some states may rely on other consumer assistance programs. The Kaiser report also found that states vary in the amount of training and even titles—generally they’re called “navigators” and “assisters”—they give to people who will be helping with ACA enrollment. Pollitz acknowledged that enrollment “may not work perfectly in the first year,” adding that the Children’s’ Health Insurance Program only enrolled about 10 percent of those eligible in its first year, but then quickly ramped up just several years later as everyone became better informed. “The opening act,” said Pollitz, “doesn’t tell you everything you need to know about the whole show.”
Do you think you’ll be eligible for tax credits to help pay for your health insurance starting in January 2014? If so, do you feel relieved to know you'll get help? Or are you still worried about this or other aspects of Obamacare?
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Fran Kritz is a freelance writer specializing in health and health policy and lives in Silver Spring, Maryland. Takepart.com