It No Longer Pays to Have Money
Who would ever think there would come a time when people don’t want to have a lot of money? Well, that time is coming soon. The new Patient Protection and Affordable Care Act (PPACA), passed earlier this year, notably increases access to health care coverage for many Americans. High-risk state insurance pools are being rolled-out; children under 19 – and even all adults come 2014 – cannot be denied health care coverage due to pre-existing conditions; and tax credits will be given to small businesses offering health insurance to their employees.
On top of that, the large post-World War II generation called the baby boomers is just entering retirement. This means that the largest generation of Americans in history is starting to collect social security and enroll into the Medicare program. Where is the money going to come from for all this?
If you guessed taxes, you’re right! Taxes are being raised, particularly for “rich” people. This does not mean that Bill Gates and his elite friends are going to give the government billions extra; rather, in a society where the average income of a four-person family is only $59,894, the “rich” are considered to be individuals with income over $200,000 or couples with joint income over $250,000. For these rich people, the Medicare payroll tax will increase by .9% beginning in 2013. Also, a new 3.8% tax is to be imposed on unearned income from interest, dividends, annuities, royalties and rents. And many states are increasing tax rates too.
The rates are rising for state income taxes.
Yet what does this mean for insurance costs? Medicare Part B premiums are steadily increasing, more so for those with higher incomes. There are levels through which premium payments are determined, dependent upon income. Only if the prior year individual income was less than $85,000 (or less than $170,000 if filing a joint return) will there be no income-related addition to the monthly Part B premium paid.
Under PPACA, businesses also will shoulder the burden of increasing health care costs. Small businesses received some benefit with potential tax credits, but larger businesses are coerced to provide coverage or pay a penalty. As of 2014, businesses of at least 50 full-time-equivalent employees will have to pay the government $2,000 per employee (excluding the first 30 employees) if it does not offer health insurance. If the business DOES offer health coverage, and employees decide to purchase insurance through an exchange and receive a subsidy, the business must pay the government $3,000 per employee. Many businesses may elect to pay these fines in lieu of offering group health plans, which generally are pricey and will only become more expensive as a consequence of all of the mandates in PPACA.
What advice could we possibly provide to you? It’s very simple, be more careful than ever with your expenditures. Since there’s not much any of us can do individually to hold the line on insurance premiums or taxes, budget wisely as the going is getting tough. And if you still want to have a lot of money in the future that’s OK, but be prepared to share.
Until next time,
AH Insurance Services
Saturday, August 28, 2010
Friday, August 20, 2010
Government Internet Portal
The Government Internet Portal
The new Internet portal (created under the Patient Protection and Affordable Care Act) is up and running! What does it do? Go check it out for yourself at HealthCare.gov. You can find and compare health care options in your area to meet your needs. It shows what government and private programs will be right for you under the terms of the Patient Protection and Affordable Care Act.
It's always a wise idea to consult with a licensed health insurance agent before choosing your health care plan. Follow this link to find a health insurance expert: http://www.ahinsuranceservices.com/
Check back soon for more insurance information.
The new Internet portal (created under the Patient Protection and Affordable Care Act) is up and running! What does it do? Go check it out for yourself at HealthCare.gov. You can find and compare health care options in your area to meet your needs. It shows what government and private programs will be right for you under the terms of the Patient Protection and Affordable Care Act.
It's always a wise idea to consult with a licensed health insurance agent before choosing your health care plan. Follow this link to find a health insurance expert: http://www.ahinsuranceservices.com/
Check back soon for more insurance information.
Thursday, August 12, 2010
High-Risk Insurance Pools: What are they?
Want to Know What High-Risk Insurance Pools Are?
One of the many parts of the new Patient Protection and Affordable Care Act (PPACA) is the creation of high-risk insurance pools, starting on July 1, 2010. Well, you probably have a few questions on high-risk insurance pools. What are they? Do they benefit you? Will these insurance pools cause an increase in your tax rate?
High-risk insurance pools are pools of money allocated to help provide health insurance for people with pre-existing medical conditions. The majority of individuals in the United States of America are covered with group health insurance plans provided by employers, and many more are capable of buying individual health insurance plans from companies such as Aetna and Humana. Even low-income families can obtain health insurance from state programs. However, someone with a pre-existing condition like, for an example, diabetes can be denied health insurance from private companies.
According to the PPACA, nobody can be denied health insurance based on pre-existing conditions starting January 1, 2014. Yet what can one do for the three and a half years until then? This is where high-risk pools come into the picture. The federal government has allocated five billion dollars to provide health insurance for those with pre-existing conditions that are unable to get coverage from private companies until January 1, 2014. The dispersal of these funds is not uniform among all fifty states; it is based on estimates of how many people will use it in each state.
Distribution of funds among the fifty states
One can only apply to receive benefits from the high-risk insurance pool if one has been denied coverage and has not had health insurance for at least six months. Nonetheless, it is not a free governmental program; insurance premiums must be paid in order to obtain coverage. In general, the premiums will be on par with those of plans offered by private corporations within the state that provide similar coverage. The good thing about this for most people in the United States is that it ensures that the high-risk insurance pool is self-sustaining: the program will not be an extra burden on taxpayers.
Yet will five billion dollars be enough? Estimates of the number of individuals that will take advantage of the high-risk insurance pool range from 200,000 to 700,000 Americans. It is apparent that some states are worried about adequate funding throughout the duration of the program. Only 28 states (and the District of Columbia) have set up their own high-risk insurance pools by federal guidelines; the other 22 have rescinded their responsibility of administering their high-risk pools to the federal government. In the case of financial failure of the program in these states, the unpaid bills will be transferred back to the federal government rather than the individual state governments. These states may just be watching their backs, but perhaps they are not confident in the feasibility of the high-risk pools.
See if your state's high risk pool is state-run or federally-run.
Until next time!
One of the many parts of the new Patient Protection and Affordable Care Act (PPACA) is the creation of high-risk insurance pools, starting on July 1, 2010. Well, you probably have a few questions on high-risk insurance pools. What are they? Do they benefit you? Will these insurance pools cause an increase in your tax rate?
High-risk insurance pools are pools of money allocated to help provide health insurance for people with pre-existing medical conditions. The majority of individuals in the United States of America are covered with group health insurance plans provided by employers, and many more are capable of buying individual health insurance plans from companies such as Aetna and Humana. Even low-income families can obtain health insurance from state programs. However, someone with a pre-existing condition like, for an example, diabetes can be denied health insurance from private companies.
According to the PPACA, nobody can be denied health insurance based on pre-existing conditions starting January 1, 2014. Yet what can one do for the three and a half years until then? This is where high-risk pools come into the picture. The federal government has allocated five billion dollars to provide health insurance for those with pre-existing conditions that are unable to get coverage from private companies until January 1, 2014. The dispersal of these funds is not uniform among all fifty states; it is based on estimates of how many people will use it in each state.
Distribution of funds among the fifty states
One can only apply to receive benefits from the high-risk insurance pool if one has been denied coverage and has not had health insurance for at least six months. Nonetheless, it is not a free governmental program; insurance premiums must be paid in order to obtain coverage. In general, the premiums will be on par with those of plans offered by private corporations within the state that provide similar coverage. The good thing about this for most people in the United States is that it ensures that the high-risk insurance pool is self-sustaining: the program will not be an extra burden on taxpayers.
Yet will five billion dollars be enough? Estimates of the number of individuals that will take advantage of the high-risk insurance pool range from 200,000 to 700,000 Americans. It is apparent that some states are worried about adequate funding throughout the duration of the program. Only 28 states (and the District of Columbia) have set up their own high-risk insurance pools by federal guidelines; the other 22 have rescinded their responsibility of administering their high-risk pools to the federal government. In the case of financial failure of the program in these states, the unpaid bills will be transferred back to the federal government rather than the individual state governments. These states may just be watching their backs, but perhaps they are not confident in the feasibility of the high-risk pools.
See if your state's high risk pool is state-run or federally-run.
Until next time!
Subscribe to:
Posts (Atom)