Our last few posts have focused on the benefits of the Patient Protection and Affordable Care Act (PPACA).  However, there are penalties for those that choose not to participate, and they increase each year.  In 2014, the penalties are the “greater of $95 or 1% of taxable income.”  In 2015, this grows to the “greater of $325 or 2% of taxable income.”  In 2016, the penalties grow to the “greater of $695 or 2.5% of taxable income.”  Annual adjustments continue in 2017 and beyond.

The powerpoint also included a table reflecting the federal guidelines for subsidies and stated that “In California, we will subsidize at 100% up to 138% of the FPL (federal proverty line).”  There is also a helpful subsidy calculator.

They also shared lessons learned from similar laws in Massachusetts:
“The results from Massachusetts show continued need to implement responsible reform that addresses cost and
quality:
▪ Covered about half of the uninsured (already exhibited lowest uninsured rate in U.S.)
▪ Premium costs for individuals in Massachusetts are the second highest in the U.S.
▪ Overall, the costs of Massachusetts health reforms have been much higher than expected
▪ Lack of an effective, enforceable individual mandate only exacerbates the cost issue in Massachusetts, and there is evidence
of enrollment gaming.”

So, what are the actual options for individuals starting in 2014? Here’s how Anthem laid it out:
“1. Get coverage through their employer if available
2. Buy an individual market plan through either:
• The individual market exchange –
Purchaser may be eligible for subsidy
• The off-exchange market
3. Go uninsured (will pay penalty unless they qualify for an individual exemption).

What’s the bottom line, according to Anthem?
“•Exchanges won’t replace the private health insurance market.
•They’re simply another channel for qualified individuals and groups to obtain coverage.”

What do you think you’ll do next year?
What questions do you still have?
We’d be happy to address them in future posts.