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Obamacare’s “Wedding Tax” and the Perks of Cohabitation October 7, 2013

Posted by QUOTEBROKER in ACA, Affordable Health Insurance, California Health Insurance, Health Care Reform, Health Insurance, Individual Health Insurance, Insurance, Insurance Quotes, Obamacare.
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Wedding days are typically one of the happiest days of a couple’s new life together, and also one of the costliest.  Under the Affordable Care Act, they are about to get a whole lot costlier. While millions of families will benefit from Obamacare’s Premium Subsidy program, a little-publicized feature of the law will adversely affect married couples.  How could a government program to hand out health insurance premium assistance be a negative? The devil is in the details- specifically the mathematics of how eligibility for the premium assistance is calculated.

Under the terms of the Affordable Care Act, individuals earning under 400% of the Federal Poverty Line- $45,960 in 2013- will be eligible to receive “Advanced Premium Tax Credits,” which is just a fancy name for government money to help pay your monthly health insurance bill.  Unfortunately for those who are married, that same Federal Poverty Line guideline sets a threshold of $62,040 in combined income for the couple.

Because of the way these figures are calculated, Obamacare actually creates a disincentive to marry or remain married, a so-called “Wedding Tax.”  Unmarried cohabitating couples are given preferential treatment under the law. Let’s look at an example of a 50 year old couple without children living in Santa Clarita, with a combined income of $50,000 per year:

Combined Income Net Premium if Married Separate Incomes Combined Net Premium If Cohabitating Benefit of Cohabitation over Marriage
$50,000 $4,752 $25,000 x 2 $3,456 $1,296

*all data via CoveredCA.com, assuming “Silver” level coverage.

The married couple actually pays an additional $108 a month, or $1,296 per year than the cohabitating couple, despite both couples receiving subsidies and both couples enrolling in identical coverage.   Now let’s take a look at what happens when the couples’ income exceeds the subsidy threshold of $62,040 by even a single dollar.

Combined Income Net Premium if Married Separate Incomes Combined Net Premium If Cohabitating Benefit of Cohabitation over Marriage
$62,041 $8,772 2 x $31,020 $5,352 $3,420

*all data via CoveredCA.com, assuming “Silver” level coverage.

Once a couple’s income breaches the threshold, the difference in premium becomes much more apparent.  In this case, the married couple pays an additional $3,420 per year for identical coverage.   One way they can attempt to solve the issue is to earn a few thousand dollars less per year, mitigating the five-figure premium difference.  There are two issues with this strategy- first, encouraging workers to work less is not good for our economy and second, if either spouse’s income is difficult to keep track of precisely they could accidentally breach the threshold despite their best efforts not to, negating the strategy.  Another way to attempt to solve the issue is to use a tax-deferred vehicle like an IRA or H.S.A to reduce the couple’s income “on paper” and keep them under the subsidy line.  While this stratrgy (under the supervision of a good accountant) may work to reduce the effects of the law on the married couple, it will do nothing to change the fact that the gap with unmarried cohabitating couples still exists.  Under the Affordable Care Act, your matrimonial “I dos” turn quickly into “I dues.”

CoveredCA provider directory still not available October 4, 2013

Posted by QUOTEBROKER in ACA, Health Care Reform, Individual Health Insurance, Insurance, Insurance Quotes.
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CoveredCA, the California state based health exchange, opened it’s doors earlier this week to much fanfare- and deservedly so. It’s the first time all California citizens have been able to access healthcare regardless of pre-existing medical conditions, and CoveredCA is the conduit for access.  However, three days in and there are still many questions to be answered by the state agency before a complete and accurate enrollment can take place. Chief of these questions is “Who are the providers available through CoveredCA?”

While CoveredCA’s shop and compare tool went live on October 1 along with the rest of the site, the Provider Directory is still unavailable. The Provider Directory is the tool used to match doctors with plans so that prospective members may know if their doctors accept a health insurance plan they are interested in.  It also allows prospective members without a current doctor to search available local providers to see who is available to treat them in their area.  This tool is not just a bonus to California residents who want to enroll in healthcare, it’s absolutely essential.

CoveredCA has acknowledged the Provider Directory’s absence, and stated that there will be more information released on the subject Monday, October 7, 2013.

Quotebroker will provide updates on the status of the CoveredCA Provider Directory as they become available. For immediate assistance from a licensed, certified insurance agent without the wait or the phone tree, visit Quotebroker.com or call 866-SUBSIDY

Obamacare Open Enrollment Made Easy October 2, 2013

Posted by QUOTEBROKER in ACA, Affordable Health Insurance, Health Care Reform, Health Insurance, Health Insurance 101, Individual Health Insurance, Insurance, Insurance Quotes, Obamacare, QuoteBroker.
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Many think Obamacare is complicated. Let’s keep this simple:

866-SUBSIDY

That’s all you’ll need to enroll. Or if you just want to ask Obamacare-related questions. Or non- Obamacare related questions. Call the number, speak with a real live human.  It’s that simple. We’ll make it easy for you.

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