This year, as I was doing my taxes, I got to wondering what is up with the healthcare “Personal Responsibility Tax” for the uninsured, and whether or not low income people really have to pay it. This mostly affects the self-employed and people without coverage through their employers, but that’s a few people, so it seemed worth investigating. As it turned out, finding out how to claim an exemption was most of the battle, and a battle it was with many spreadsheets and worksheets and interactive tax tools to be filled out. The answer I arrived at was “no” — unless you make more than $53,737 (as a single person), you’re not required to pay the uninsured person’s tax. This is because you are not required by law to expend more than 8.05% of your income to buy health insurance. If the cheapest plan is more than 8.05% of your income, you don’t have to buy it or pay the fine. But you are strongly encouraged to consider other healthcare options…
As far as Bronze goes, the state’s lowest priced option, it’s not like you’re getting a great plan. You get to pay $360.49 per month ($4325.88 per year) and then if you want to use your health insurance to get healthcare, you need to pay another $5,000-$10,000 per year in deductible. To get healthcare with only a $2000-$4000 deductible, you have to pay $428.14 per month. That would be the silver plan. The gold plan is $493.27 per month but you still have a deductible of $1500 to $2500 per year…
This creates a double whammy of crap. Even relatively well-paid people making over $50,000 per year are forced into an expensive system that doesn’t really get them much beyond catastrophe insurance. Meanwhile, low income people – those whose individual income is less than $54,000 – have to get health insurance from what we usually think of as Welfare, i.e. the Medicaid system. I guess I didn’t know this before, but if you don’t make enough for Bronze, you’re probably not middle class anymore, at least not as far as the government is concerned. For some, this is no problem. They’ll just sign up for whatever state or federal plans exist for low income people. But others, and I’m thinking of conservatives here, may opt to do without.
I’d like to see a better healthcare system, one affordable to all, including the majority of people in Brattleboro, so that getting healthcare can be possible for the people who need it without dividing us up into these class-based buckets. But as long as healthcare is mediated by the private insurance market, we’re never going to see a real reduction in the cost of healthcare. There’s just no incentive to lower prices once everyone is required to pay you.
On the other hand, a single payer system would probably have a lot more clout – do you want to make any money at all selling healthcare in this country? Then play ball. I think the healthcare companies would fall in line, just as they have everywhere else that single payer healthcare is in effect. This year, we actually have a choice between corporate, for-profit healthcare and a single payer government plan. Given our current pickle with universally expensive healthcare, it will be interesting to see what we decide as primary season winds down.
If you’re interested in the exemption for the federal Individual Responsibility Payment, you may find this link helpful:
For more on the State of Vermont’s Bronze plan see the brochure:
http://info.healthconnect.vermont.gov/sites/hcexchange/files/Bronze%20Brochure%20FINAL.pdf
The other insurance plans are here:
http://info.healthconnect.vermont.gov/2015healthplans#PCBs
Gifts to the insurance industry
This is astonishing to read. I ignored Obamacare because I’m on Medicare, which sucks also. But to read AHCA in this detail drives home that Medicare and AHCA both incredible gifts to the insurance industry.
Medicare and the insurance lobby
Traditional Medicare isn’t all that bad compared to a lot of other insurers. The so-called Medicare “Advantage” plans really do suck; definitely designed by the insurance industry and its lobbyists, who are the only ones to receive any advantage from them. The same applies to the Medicare D plans; many of them are heavily tilted in favor of the insurance and pharmaceutical industries.
Profiting from the sick
It’s a disgrace that private health insurance exists at all, IMHO. But that’s a “money is all that matters” society for you. In a roundabout way, the ACA and people needing to become aware of health insurance may end up getting us single payer in the end. What we have now sucks. Once Congress got its hands on it, it was doomed.
Here's another point of view.
http://watchdog.org/261960/vermont-health-care-professionals-dissatisfied/
rich get richer
Interesting factoid from the state economic review that Spoon posted. In it, they say the Vermont rich are getting richer and the rest are doing not-so-good. And regarding that wage:
“In the decade since 2004, median household income fell from $58,328. inflation-adjusted dollars to $54,166”
In the same time period, the top 1% of Vermonters had $700 million in total income; in 2014 it was $2.4 billion.
54,000 is a magic number
So $54,000 is the state’s median household income? But even individuals would have to make about that to afford the lowest price marketplace health insurance plans in Vermont. This seems out of whack with reality, since it looks like a lot of individuals make less than the median household income.
The Department of Labor has a report that shows the median ‘wage’ income to be about $37,000 as of 2015. $54,000 is the 75th percentile for individual wage earners, according to this table. Or at least, that’s what it looks like to me.
Vermont Wage Distribution
all Industries and all Occupations estimates (2004-2015)
http://www.vtlmi.info/oessummary.htm