POLITICO, June 28, 2012 -- The individual mandate, the centerpiece of the health care law, is contentious, unpopular — and misunderstood.
So confusing in fact, that all sorts of myths have cropped up around it.
Here are five common misconceptions explained.
1) Everyone has to “buy” insurance or pay a fine.
The law says most people have to have insurance — but not everyone has to go out and buy it. If you have insurance through your employer or a government program, like Medicare, that counts. About 250 million insured people already meet the rules, according to the Congressional Budget Office.
That leaves about 7 million people who will have to buy insurance without the help of one of the subsidies built into the law, according to Urban Institute researchers.
2) People will have to buy insurance even if they can’t afford it.
Experts disagree on what affect the law will have on insurance premiums. Republicans argue it will actually add to costs, with some estimating the baked-in rules and regs will cost families $1,200 the first year, and at least a 13 percent premium excess charge in 2016.
But the law provides for subsidies for low- and middle-class people to buy health care in the new state exchanges. It’s on a sliding scale, with help available for families earning up to 400 percent of the federal poverty level, currently around $92,000 for a family of four.
Some people are also exempt from the mandate on hardship grounds. That includes people so poor that they don’t have to file taxes (income around $9,500 for individuals and $19,000 for married couples) and people who have access to health care through a job but would have to spend more than 8 percent of family income to take it up (after employer contributions and federal subsidies are taken into account).
3) Young and healthy people must buy expensive policies they can’t afford and don’t need.
While the young and healthy will be required to have health insurance, the law has some incentives for them. Young adults under age 26 can stay on their parents’ plans, if they don’t have an alternative through a job. People under age 30 can buy a lower cost “catastrophic plan” through state exchanges, which means they’d be covered in the event they were hit by the proverbial bus. Still, Republicans argue rates for the young and healthy could increase, even with the new provisions.
4) People won’t be able to keep their current insurance.
President Barack Obama often promised, “If you like your current plan, you will be able to keep it.” And for millions of people that will be true. But as Republicans have pointed out, many people who work for small businesses will have to get different health plans in the next few years. And while they may have better benefits, under the new rules, they may also cost more. Of course, employers can change which health plans they offer workers, just as they do now, with or without the new health law.
5) The penalties are exorbitant. I could even get thrown in jail.
Being uninsured doesn’t mean you will be thrown in prison. You may have to pay a penalty — or as the court ruled Thursday — a tax. Starting in 2014, that fee is as little as $95, but it does rise to up $695 or 2.5 percent of taxable income in 2016. Subsequent increases are linked to the cost of living adjustments.
One point of comparison: In Massachusetts, where a state mandate exists, only about 1 percent of taxpayers paid a penalty in 2009.
Posted By: Richard Kigel
Saturday, June 30th 2012 at 11:36AM
You can also
click
here to view all posts by this author...
