Individual Mandate. Penalty or Policy?

[ChristopherCoy]

Originally Posted by texkam

All political joking aside, a very relevant informative thread.

It is... considering that I contemplating going 'full time' in the next 6 to 9 months.

I hope this one stays on track and doesn't get closed. Good info, jokes and all.

[SCone]

Originally Posted by ChristopherCoy

A. I know nothing about this kind of stuff, and choose to not pay attention to it until the tax man says that I need to write a check.

In 1916, only those earning more than $1.5 million faced a 15 percent tax. It took only ONE MORE YEAR for the tax code to change to anyone with over $40,000 to pay a 16 percent tax and the individual with $1.5 million skyrocketed to 67 percent. And a year later, it rose to 77 percent.

Once the camel's nose is under the tent......

[texkam]

Once the camel's nose is under the tent......

Did you hear .....? $50.00 to start a thread, $5.00 to make a post.

[WarrenG]

Ok, I spent a lot of time reading last night (no I did not read the whole thing last night, but it did help me fall asleep). Here is a link to all 906 pages of the actual bill: HR 3590 if anyone is interested. Bill Text - 111th Congress (2009-2010) - THOMAS (Library of Congress)

Sorry for any confusion, but I think I have it somewhat figured out now, maybe, sort of? While logic makes it seem obvious that a small business owner would be exempt if insured under a spouses policy, the bill clearly does not specifically state that they will be, anywhere in it. Furthermore, since the entire system will be regulated by the IRS, it should prove to be very interesting.

I have been speaking with several insurance brokers and there is A LOT of misinformation and confusion, part of which is what made me create this thread. To be honest, I still find it challenging to actually digest the verbiage in this thing.

I also find it extremely disturbing and somewhat frightening that as citizens many of us do not fully understand exactly what will be happening with this bill.

Here are some more interesting highlights

Effective by January 1, 2011

• Employers must disclose the value of the benefits they provided beginning in 2011 for each employee's health insurance coverage on the employees' annual Form W-2's
  
• Flexible spending accounts, healthcare reimbursement arrangements and health savings accounts cannot be used to pay for over the counter drugs, purchased without a prescription, except for insulin.

Effective by January 1, 2012

• Companies will be required to issue 1099 forms to any vendor of services or rental property to which the business has paid more than $600. Form 1099 is also sent to the IRS. Under the existing law, businesses issued the Form 1099 only to individuals who provided services or property to a business. The healthcare law included the same form be issued to corporations as well, and that the form be issued to individuals and corporations that provide property to the business
  
• Self-employment and wages of individuals above $200,000 annually (or of families above $250,000 annually) will be subject to an additional tax of 0.5%
  
• Increases Medicare payroll tax by 0.9% for individuals earning over $200,000 and couples earning over $250,000. [additional provisions in reconciliation, H.R. 4872]

Effective by January 1, 2014
Insurers are prohibited from discriminating against or charging higher rates for any individuals based on pre-existing medical conditions.[31][58]
Insurers are prohibited from establishing annual spending caps.[31]
Expand Medicaid eligibility; individuals with income up to 133% of the poverty line qualify for coverage, including adults without dependent children.[59][60]
Two years of tax credits will be offered to qualified small businesses. In order to receive the full benefit of a 50% premium subsidy, the small business must have an average payroll per full time equivalent("FTE")employee, excluding the owner of the business, of less than $25,000 and have fewer than 11 FTEs. The subsidy is reduced by 6.7% per additional employee and 4% per additional $1,000 of average compensation. A 16 FTE firm with a $35,000 average salary would be entitled to a 10% premium subsidy.
Impose a $2000 per employee tax penalty on employers with more than 50 employees who do not offer health insurance to their full-time workers (as amended by the reconciliation bill).[61]
Set a maximum of $2000 annual deductible for a plan covering a single individual or $4000 annual deductible for any other plan (see 111HR3590ENR, section 1302). These limits can be increased under rules set in section 1302.
Impose an annual penalty of $95, or up to 1% of income, whichever is greater, on individuals who do not secure insurance; this will rise to $695, or 2.5% of income, by 2016. This is an individual limit; families have a limit of $2,085.[59][62] Exemptions to the fine in cases of financial hardship or religious beliefs are permitted.[59]
Under the CLASS Act provision, creates a new voluntary long-term care insurance program; enrollees who have paid premiums into the program and become eligible (due to disability or chronic illnesses) would receive benefits that help pay for assistance in the home or in a facility.[63]
Employed individuals who pay more than 9.5% of their income on health insurance premiums will be permitted to purchase insurance policies from a state-controlled health insurance option.[30]
Pay for new spending, in part, through spending and coverage cuts in Medicare Advantage, slowing the growth of Medicare provider payments (in part through the creation of a new Independent Payment Advisory Board), reducing Medicare and Medicaid drug reimbursement rate, cutting other Medicare and Medicaid spending.[33][64]
Revenue increases from a new $2,500 limit on tax-free contributions to flexible spending accounts (FSAs), which allow for payment of health costs.[65]
Chain restaurants and food vendors with 20 or more locations are required to display the caloric content of their foods on menus, drive-through menus, and vending machines. Additional information, such as saturated fat, carbohydrate, and sodium content, must also be made available upon request.[66]
Establish health insurance exchanges, and subsidization of insurance premiums for individuals with income up to 400% of the poverty line, as well as single adults.[60][67][68] Section 1401(36B) of PPACA explains that the subsidy will be provided as a advanceable, refundable tax credit[69] and gives a formula for its calculation.[70] Refundable tax credit is a way to provide government benefit to people even with no tax liability[71] (example: Child Tax Credit). According to White House and Congressional Budget Office estimates, in 2016 the income-based premium caps for a "silver" healthcare plan for family of four would be the following:[72][73]
Income Premium Cap as a Share of Income Middle of Income Range (family of 4)a Avg Annual Enrollee Premium Premium Subsidy (share of premium) Avg Cost-Sharing Subsidy
100–150% of federal poverty level 2.1–4.7% of income $30,000 $600 96% $3,300
150–200% of federal poverty level 4.7–6.5% of income $42,000 $2,400 83% $1,800
200–250% of federal poverty level 6.5–8.4% of income $54,000 $4,000 72% 0
250–300% of federal poverty level 8.4–10.2% of income $66,000 $6,100 57% 0
300–350% of federal poverty level 10.2% of income $78,000 $9,200 44% 0
350–400% of federal poverty level 10.2% of income $90,100 $14,100 35%

[XtremePhoto]

Originally Posted by WarrenG

Effective by January 1, 2011[LIST][*]Employers must disclose the value of the benefits they provided beginning in 2011 for each employee's health insurance coverage on the employees' annual Form W-2's

I am in the same boat with you Warren...wondering JUST EXACTLY what all this will end meaning for those that matter. I have been told by several people that are involved in this area that the above W-2 is in fact more of a penalty. You will have that amount added to your income and THEN be taxed on that amount. The money to insure those without has to come from somewhere and this is one way they plan to get it.

I wish they would just put it in plain English so that we can understand.

-G-

[TheFantasticG]

The people who wrote the bill don't want you to understand it.

The Wife wants to buy into a small local business. This OB might end up causing the business to shut down if they can't afford to insure their employees.