This is a guest post by Gail S and entry for our non-fiction writing contest.
Prizes for this round include…
- First Place winner will receive - A $150 gift certificate for $150 off Wolf ammo courtesy of LuckyGunner. A Humless 2.5 Watt Portable Solar Panel courtesy of LPC Survival
- Second Place winner will receive – Two Emergency Seed Banks (stored in military ammo cans) with over 33 varieties of non-hybrid garden seed courtesy of TheSurvivalistBlog.net from M.D. Creekmore’s personal seed stash. A $260 value.
- Third Place winner will receive - a one year subscription to Personal VPN service courtesy of unspyable and a copy of my book 31 Days to Survival: A Complete Plan for Emergency Preparedness.
This contest will end on September 9 2013
I live in California. California is apparently leading the nation on setting up the exchanges for ObamaCare 2014. In fact, not only will they be setting up the exchanges for individuals, it would appear that they are going to be ready to go on small business groups as well. A small business group is defined as less than 50 employees. The Federal government has announced that on the exchanges they are setting up, it will be at least 2015 before they will be active for small employee groups. How a small business is going to interact with the exchanges in order to obtain coverage for their employee is not yet clear.
Random ObamaCare facts. Some of this information could change between now and 1/1/2014, and this is based upon California at the present time and what I have gleaned about the status of the program from the Feds.
1. In California If your earnings are 133% or less of Federal Poverty Level, you will being enrolling in MediCaid/MediCal. If you use the Covered California website to apply, you will automatically be redirected to the MediCal website. This does not mean that your coverage is “free” as there is some unpublished chart called “Share of Costs” that applies when a person actually uses MediCal. ObamaCare mandates that the factor of 133% of Federal Poverty Level be used to establish the low income standard to be eligible for MediCaid/MediCal.
Many states use 100% of Federal Poverty Levels to establish income standards for MediCaid. The Feds are giving grants to the states setting up their own exchanges for three years to cover the additional 33%. Please note for those that are experiencing premature elation that by having a low income they are going to be able get medical care, beware. At least in California already, any dr.’s office that you call to make an appointment are asking what kind of insurance you have and are unequivocally stating that they are not taking MediCal patients or patients enrolled with MediCare unless the patient has an acceptable supplement. The state is setting up clinics in most areas to help with this push back from the doctors. Some doctors are contributing time to these clinics; we will see how long that lasts.
2. Federal poverty level information below is based upon overall family income and number of people in the family, see……. http://aspe.hhs.gov/poverty/13poverty.cfm
3. In the 26 States that are refusing to bring their own plan in, there will be no grant from the Federal Government to cover the extra 33% above Federal Poverty Level and it appears that in order to qualify for what is passed as government aided healthcare in those states you will have to be below 100% of Federal Poverty Level. (This could change). PLEASE DO NOT RANT AT ME AS REGARDS THE EXACT NUMBER OF STATES RESISTING OBAMACARE EXCHANGES! That is a fluid situation and is based upon political pressure and actuaries to determine where each state is better off. So when this is published it may be 24 states instead of 26………..whatever!
4.In California, from 2014 through 2017 there will be premium subsidies, also called advance tax credits for those earning between 133% of Federal Poverty Level to 400% of Federal Poverty Level. That means the full standard total premium would not be charged until a family of four had a total income of $89,400 in 2014. Each year that subsidy is reduced, with the same family of 4 paying a larger percentage of the premium until in 2018 (The year after Obama is no longer in office).
After which there will no longer be premium subsidies nor will there be grants to the states to cover the 33% over Federal Poverty Level for Medicaid/MediCal patients from the Federal government. It will then be up to the individual states to meet the requirements of ObamaCare out of state tax revenues if they want to be able to continue subsidies and meet that 133% of Federal Poverty level mandate. Even with subsidies, these exchange plans are not cheap. As you will see further along in the article.
5.In California if you are 65 or over and use the website to apply, you will automatically be redirected to the MediCare website.
6.In California there will be 4 major plans, a Platinum; a Gold; a Silver; and a Bronze. There will also be a “catastrophic” plan, some versions of plans with flexible spending accounts and a plan with a health savings account. Anyone can go view these plans by visiting “Covered California” at _http://www.coveredca.com/coverage_basics.html, roam around the website and you will see the coverages of the 4 available plans and an estimator of what premiums can be estimated to be.
7.Please pay attention to the lines near the top that show overall deductibles and out of pocket limits. The out of pocket limits must be reached in order to have the plans pay at 100%. Also check the notes in fine print at the bottom that state that family deductibles and out of pockets are 2x the individual out of pockets and deductibles listed at the top.
To check out some ideas of what your monthly premium might be, the covered California website has a calculator based upon the premium plan. That website is again
The cost estimator is based upon the silver plan. That is the plan that will be subsidized by the American taxpayers via Federal grants to the states.
Make sure that you add your out of pocket maximums and your deductibles correctly, depending upon the number of members there are in your households then add your annual premium together so that you will know what the total cost of the health plan will be. For instance, in year 2014:
A couple: Aged 55 and 52, earning $45,000, their subsidized premium would be $346 a month or $4152 per year, plus double deductibles and out of pockets on the Silver Plan of $12,800 = a total cost of $16,952.00 +/- some deductibles and unrecoverable rx’s and such.. That cost is, of course, the absolute maximum for two people, both of them needing hospitalization. I am praying that this couple doesn’t have a bad car accident!
A single woman aged 60, earning $55000, her subsidized premium in 2014 will be $782 per month or
$9384.00 per year. Add the appropriate deductibles of $6400 and your total out of pocket would max out of pocket of $15,784.
Now if the cost of ObamaCare hasn’t choked you up and made you opt to move out of the country yet, let’s go over the punishments that will apply over the years from 2014 through 2017 if you decided you don’t want health insurance.
1. CoveredCalifornia will be able access your last tax return in order to establish your projected income and number of dependents. That is the baseline they will use to establish your premium to start in 2014.
2.Those not wishing to get coverage the penalties are as follows:
- 2014 – $95 up to a max of 3 per family or 1% of Income to a maximum of $285.
- 2015 – $325 up to a max of 3 per family or 2% of Income to a maximum of $975
- 2016 – $695 up to a max of 3 per family or 2.5% of Income to a maximum of $2085.
I have heard that there are several ways that this fines/taxes will be collected.
Option A. When you file your tax return starting in 2015, there will be a line on your tax return asking you to state your insurance carrier and the policy #. If that line is blank, the fine will be deducted directly from any tax refund you are expecting.
Option B. It will be directly withdrawn from your checking account.
As the penalties for not covering go up each year, the subsidies for the exchanges goes down each year.
One last note about subsidized premiums: If you underestimate your annualized salary and you receive a subsidy, there will be an accounting on your tax return to return any “over subsidy” you received for your premium. Adds insult to the injury doesn’t it?
ObamaCare at the Federal Level ……….
The Federal Government is not doing as well. The reason for that is roughly 26 states are not yet committing to setting up their own plan, and that means the Feds have to build a Federal Government exchange for them. The reasons for why 26 states are not setting up exchanges for themselves are myriad, but the biggest ones have to do with “subsidies “ and funding for the 33% over the 100% of Federal Poverty Level..
•The Feds propose to give states for a period of 3 years, grants to help people signing up for health care with the cost of the premiums. After which in 2018, they will be on their own to continue the plans. These states fear that in 2018, they won’t have the revenue to continue premium subsidies and that the population will not be able to afford the premiums on their own.
•The other reason is that the Feds have promised to “fund the 33% portion of the 133% of poverty level” MediCaid/MediCal eligible citizens for a period 3 years, and then drop it on the states to continue to fund on their own. Again, 26 state governors are looking hard at whether there will be revenues to continue ObamaCare in 2018 on their own and that is why they are not diving in to this.
NOTE: The 26 states not presently interested in setting up their own exchanges may change their minds. The Feds are likely to punish by charging a tax for setting up plans for them. Well, not them actually, they are going to add a tax onto the premiums that are charged through the insurance carriers to anyone seeking insurance on the exchanges that are set up by the Federal Government for your state.
Big Business Decisions.
Many large corporations have caught on to the fact that they do not have to offer health care and are penalty free if an employee works less than 30 hours per week. These employees are considered part time. Those employees still must get health insurance or will be penalized. In order to afford coverage, these employees will require two part time jobs in order to afford coverage or they will be subject to the penalties. Many employers have already stated that they have directed their Human Resource staff to reduce the number of full time positions and increase the number of part time positions.
Restaurants (Olive Garden, Red Lobster, etc.), theatre groups, hotels have all penciled in the numbers for 2014 and have figured out where they need to be in order manage costs. Anyone employed in a low skilled job, (cashiers, store stockers, manual laborers) is in danger of having their hours reduced to keep exposure rates low for larger companies. Just think, employees will be putting in 60 hours weeks at regular time in order to make ends meet………..and none of those extra 20 hours will be paid at overtime.
Large corporations generate their own premiums based upon the health claims experience of the whole group they insure. For the next three years, if the premium rates for their group is relatively stable, chances are good that they will contribute to the health insurance of their full time staff. Should their premiums increase significantly then another choice they will make is to do a calculation on what it would cost to just close up their plans, send their employees to the exchanges and pay the tax of $2000. per full time employee to the Federal government. It is with this choice that employees may find their hours cut to less than 30 hours per week in order for the business not to be taxed for this employee.
There are other “fine points” to consider for a larger business. What their competition is doing, risk of exposing themselves to unionizing attempts for not covering employees, the ethical/moral considerations of the principals of any organization all will play a role in the decision making process. Whatever a large corporation does, they will be confined as to what they can ask of the employees in the way of a contribution. That limit is 9.5% of the employee’s annual estimated pay. At that point, if the corporation exceeds that limit and one employee seeks and gets insurance on an exchange, the tax for that employee will be $3,000 to the Feds. (This feature has more detail, but I am generalizing this 9.% % for purposes of giving you a point of reference for evaluation.)
As it is still murky and the scheme is still afoot from that soulless cretin Kathleen Sebillious I am not going into the so called “death panels” that are going to be set up. At present, the documents regarding this are stating that she can install whomever she wishes on these panels. They do not have to be doctors or attorneys. That alone is alarming! Think a death panel with only left wing individuals who want to decide which people with specific diseases are no “longer viable”…………..
There is no great conclusion I can draw to this. In California, over the next 4 years, there may be some individuals in lower paid jobs or are working at minimum wage that will better off because they will be in the MediCal program and will not be subject to premiums. For anyone else, drawing down a modest income, chances are that their premiums will be higher, their deductibles will be higher, their out of pockets will be higher and their risk of filing bankruptcy due to medical costs is about the same as it was before the whole ObamaCare debacle.
Insurance companies are not specifically complaining about ObamaCare as there is no mandate against raising rates to cover claims. The only provision of note for an insurance company is that no more than 15% of their total income can be used for administrative costs. Before ObamaCare, most insurers in California targeted somewhere under 10% of total income for administrative costs………..They just got a raise.
When ObamaCare was first presented, there were limited coverages for illegal aliens, yes illegal aliens, I am not going to be PC correct based upon whatever agenda the AP is following. There were some limited exceptions as to emergency rooms. Now, some clown in the Senate or House has proposed to open ObamaCare up to illegal aliens. How they plan on collecting taxes for this group is murky as is much of this plan.
One more comment. Health Insurance and health care comprises approximately 20% of the total US economy. As run by the insurance carriers and with whatever faults it has had, it was profitable and in some cases some carriers were are trading on the stock exchanges. The Federal government used its faults to take over a profitable and significant portion of the economy with the ObamaCare move. With Social Security, Medicare and Medicare RX drowning in red ink, it has been eyed by some in Washington as a “way to help keep other social programs afloat…………..”. Think what you will of the success of that dim unexplored reasoning…………we are here………………prepare!
Note: This article is published for informational purposes an should not be taken as legal advice.