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Old 01-22-2014, 01:03 PM
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Mary Pat Campbell
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Default Things I Discover About PPACA

I wanted to separate it from the exchange thread, because now I'm starting to learn stuff about the bill I didn't notice before.

So, I didn't realize that the growth in the premium subsidies is capped:
http://blogs.investors.com/capitalhi...nder-obamacare

Quote:
The Congressional Budget Office confirmed late last week that some who qualify for subsidies to buy health insurance through the exchanges created by the Affordable Care Act (aka ObamaCare) could see those subsidies shrink starting in 2019.

Under a cost-control inserted during reconciliation, a greater share of premium payments would steadily shift to individuals and families after 2018 if exchange subsidies top 0.5% of GDP — as CBO projects they will.
.....
Based on the economic inputs in CBO’s example — 6% premium cost growth, 3% income growth and 2% inflation — subsidies also would shrink starting in 2019 for mid-career singles with income as low as 300% of the poverty level and mid-career families at 375% of the poverty level, Capital Hill’s analysis reveals.

In ensuing years, the poverty threshold at which subsidies would decline outright would move steadily lower.
....
Initially, starting in 2016, the percentage of income owed by individuals and families toward premiums — before subsidies kick in — would increase to the extent that average premium growth in the prior year exceeds average income growth.*

Then, as early as 2019, in addition to the prior indexing (premium growth minus income growth), there would be a further adjustment based on premium growth minus inflation.
In CBO’s example, a family at 250% of the poverty level would see their premium payment rise by 11% in the first year, soaking up nearly 75% of their real wage gain (before additional cost-sharing payments for utilizing health services or payroll taxes on the extra income).

Even still, government subsidies for such a family would rise by 4.1%, more than twice the rate of inflation.
I don't think PPACA is going to survive til 2019, but I thought it was interesting.
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Old 01-22-2014, 01:06 PM
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Pulled from the exchange thread, while I knew that the mechanism for premium subsidy clawback was going to be reduced tax refunds (so if one underwithholds... woo hoo!), I didn't realize there was a cap on the size of the clawback:
http://nationalinterest.org/commenta...re-crisis-9712

Quote:
So if you qualify for more subsidy help than you receive during the year, you’ll get a tax refund. But if you were given more subsidy than your income qualifies you for, you will be required to repay the excess subsidy.

However, repayment of the excess subsidy is capped for all those earning less than 400 percent of the federal poverty level (FPL). For those who earn less than 200 percent of the FPL, an individual’s repayment is capped at $300 and family’s capped at $600. For those between 200 percent and 300 percent of the federal poverty level, an individual is capped at $750 and a family repayment is capped at $1,500. And for those who earn at least 300 percent of FPL but less than 400 percent, repayments are capped at $1,250 for an individual and $2,500 for a family.

Only Americans making more than 400 percent of the federal poverty level would be forced to repay all of an incorrectly calculated Obamacare subsidy.
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Old 01-23-2014, 11:28 AM
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Do I read that as "As a low income american, I am incentivised to over-subsidize my payments, since the amount I would pay back is less than the subsidy," and if so, who decided on that idea? As if our taxes weren't such a game already.

This sometimes feels like watching multiple trains crash into one another at a rail yard. I can't untangle the causes and effects without months of careful research.
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Old 01-23-2014, 12:03 PM
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You might enjoy this one:

http://theincidentaleconomist.com/wo...loophole-work/

http://theincidentaleconomist.com/wo...ole-an-update/
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Old 01-23-2014, 01:02 PM
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Quote:
Originally Posted by campbell View Post
I wanted to separate it from the exchange thread, because now I'm starting to learn stuff about the bill I didn't notice before.

So, I didn't realize that the growth in the premium subsidies is capped:
http://blogs.investors.com/capitalhi...nder-obamacare



I don't think PPACA is going to survive til 2019, but I thought it was interesting.
Yes, all of those indexed-ratcheting thresholds will yield a ton of studies produced by various entities, and they will be used to justify legislation that will tinker with the moving parts.
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Old 01-23-2014, 01:25 PM
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I didn't know that non-discrimination testing was part of PPACA

(I find out about some of these things as they get delayed by whatever means -- it sounds like the IRS made the decision on this one)

http://www.lifehealthpro.com/2014/01...nation-testing

Quote:
Robert Pear, a New York Times reporter, made waves this week by calling the Internal Revenue Service and what happened to the Patient Protection and Affordable Care Act nondiscrimination provisions.

The IRS told him it will wait at least until 2015 to enforce the nondiscrimination rules, at the earliest, because defining terms such as “highly compensated employee” and “discrimination” has been difficult.

Originally, the rules were set to kick in September 2010.

Section PPACA 10101(d) added the non-discrimination rules to Section 2716 of the Public Health Service Act. The changes require insured group health plans to comply with the same sorts of anti-discrimination rules that self-insured employers have faced since the 1980s.

PPACA defines “highly compensated individuals” as a group that includes the five highest-paid officers, but also shareholders who own more than 10 percent of the company’s stock and the highest-paid 25 percent of the employees.

The IRS put out a notice seeking comments on the rules, IRS Notice 2010-63, in September 2010, and the agency has referred to the nondiscrimination rules in proposed regulations, such as the new proposed regulations that could create a new type of “wraparound insurance” that could fill in some of the holes left by PPACA exchange plan coverage.
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Old 01-23-2014, 01:35 PM
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That is correct. I did not know that.

I will quote:

http://theincidentaleconomist.com/wo...loophole-work/

Quote:
Imagine insurance plans fall into one of two buckets: Bucket A holds the individual and small-group markets; Bucket B captures the large-group market and self-insured plans (usually only large employers self-insure, but small businesses are increasingly looking to self-insurance to ease regulatory pressures).

.....
Coverage is regulated less stringently for Bucket B. Large-group** and self-insured plans still have to offer copay-free preventive care, but they aren’t legally obligated to offer additional benefits; plans can be sold even if they skimp on EHBs. And those plans don’t need to meet a 60% AV minimum. Here’s the real wrinkle: out-of-pocket spending protections only apply to benefits covered by the plan. In theory, a mini-med plan could cover the bare minimum in preventive services, and nothing else. However, offering—and carrying—subpar coverage has implications for the employer and individual penalties.

Employers with plans that fall into Bucket B essentially have three options.

1. Offer compliant coverage. Most employers have always offered coverage that generally complies with requirements laid out in the ACA (98% of individuals enrolled in employer sponsored insurance have plans with an actuarial value that meet or exceeds the “gold” level on exchanges). Employees offered compliant coverage from an employer are not eligible for exchange subsidies.

2. Offer “loophole” coverage. Employers that offer large-group or self-insured plans have the freedom to purchase plans that don’t comply with all of the ACA’s intended protections. However, if the plan doesn’t offer a minimum actuarial value of 60%, employees below 400% FPL are eligible for subsidies. The employer could be slapped with the “light” version of the employer penalty, $3,000 per employee who opts into the exchange. Individuals who carry subpar coverage might also be subject to the individual mandate penalty.

3. Offer coverage that doesn’t even meet loophole standards—or no coverage at all. If a large employer’s plan fails to meet the barest preventive care requirements, or if a large employer doesn’t offer coverage at all, they’re subject to a $2,000 penalty per full-time worker***.


This week’s WSJ story introduces a new twist: employers could get around the employer penalty associated with skimpy coverage if they offer a compliant plan alongside a mini-med option. Because employees are offered minimum essential coverage through their employer, they’re ineligible for tax credits; those are the trigger mechanism for the employer penalties.

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Old 01-23-2014, 02:29 PM
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Mary Pat,

Did you know this?

Supporters of the ACA often state that the law is “fully paid for” and will not add to the long run government deficit. Do you know how they make this claim? By assuming that physician reimbursement under Medicare will fall below that of Medicaid. See page 8 of the report by Medicare’s Office of the Actuary.

http://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/ReportsTrustFunds/downloads/2012TRAlternativeScenario.pdf
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Old 01-23-2014, 02:34 PM
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Ha!
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Old 01-23-2014, 05:28 PM
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What I didn't know is one of our founding fathers is on the AO.
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