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The last date to purchase individual, renewable health insurance during the first open enrollment period in 2014 was March 31st. Unless you qualify for a special enrollment period, you will not be able to buy renewable individual, health insurance again until the next open enrollment period which begins on November 15, 2014 with coverage effective dates starting no sooner than January 1, 2015.

You can however stay insured between open enrollment periods by purchasing non renewable, short-term health insurance. Our recommendation is Assurant health insurance company. Assurant health is one of the only companies with temporary health insurance that also covers outpatient and inpatient prescription drugs the same as any other illness. Many of the other carriers who offer temporary health insurance do not cover outpatient prescription drugs or if they do, they only cover a small amount after you have paid your health plan deductible. This can lead to catastrophic out of pocket expenses for those who develop a major medical illness outside of open enrollment.

About Assurant

Assurant, a Fortune 500 company and a member of the S&P 500, is traded on the New York Stock Exchange under the symbol AIZ. Assurant has approximately $29 billion in assets and $8 billion in annual revenue. Assurant has approximately 14,500 employees worldwide and is headquartered in New York's financial district. Assurant Health’s products are underwritten and issued by John Alden Life Insurance Company, Union Security Insurance Company and Time Insurance Company, which has been in business since 1892. Headquartered in Milwaukee, Wisconsin, Assurant Health employs approximately 2,000 employees. Assurant Health is rating A-(Excellent) by A.M. Best ratings.

To get quotes & apply online for Assurant Health's temporary health insurance click their logo below:

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You will owe a non compliance 'fine' to the IRS for buying short term insurance

You must also understand that you will be subject to a 1% of your MAGI 'fine' (TAX) for purchasing temporary health insurance since these plans do not include the "essential health benefits" under Obamacare such as Maternity for 62 year old women and single men, drug rehab coverage for those who do not own a crack pipe and pediatric dental for those without children. As such temporary policies are not considered 'qualified health plans'. Rest assured though, if you are self employed and do not over pay your taxes you will never pay that 'fine' (TAX) for the only recourse the IRS has to collect that fine is to hold your tax refund. All criminal penalties for non compliance were removed from the health care law prior to passage.

If your pre-2014 individual plan is renewing in 2014 that is a 'qualifying event' with Assurant.

Assurant Health announced yesterday that they are now honoring this regulation that states quite clearly that if you have an 'old' policy from the 'old' market and that plan renews you can purchase a 2014 'qualified' Bronze, Silver, Gold or Platinum health insurance plan on or off the exchange on a guaranteed issue basis between open enrollment periods. This is VERY good news for anyone who has an 'old policy' that renews this year and is facing a large premium increase and/or has exclusion riders on their existing policy and wishes to purchase a new 2014 plan without exclusion riders. 

At this juncture, Assurant Health is the only carrier that we are aware of that is honoring the aforementioned regulation and as such they have a corner on the market until the next open enrollment period begins on November 15, 2014 for coverage effective dates beginning no sooner than January 1, 2014. As I stated in this recent article, many health insurance carriers like Aetna and Humana are not even offering short term (temporary) health insurance products until the next open enrollment period and the few carriers who are offer them with dangerously low lifetime maximum coverage amounts. It must also be reiterated that if you purchase short term coverage these policies do not cover preexisting conditions and you will be subject to a 1% of your MAGI 'fine' (TAX) from the IRS if you purchase short term coverage because those plans are not considered 'qualified health plans' under CMS and HHS regulations.

If your old health insurance plan is renewing in 2014 and you wish to get quotes from Assurant Health for a qualified replacement plan click their logo below. There is a now a new section on the application where you will need to either upload a copy of your existing health insurance ID card proving that you have a policy from the old market or you can fax a copy of your old ID card to the fax number provided on the application. This is necessary to prove that you qualify for a special enrollment period as an applicant with a qualifying event. 

Most other insurers will not offer health insurance again until November 15, 2014

United HealthOne is no longer offering health insurance products of any kind in Illinois as of January 1, 2014. They do offer fixed indemnity plans, these are not health insurance products and we do not recommend purchasing fixed indemnity plans. The risk exposure is too great. United HealthOne is offering temporary health insurance outside of Illinois between open enrollment periods in 2014. Click the United HealthOne logo to apply for health insurance on or off the health insurance exchange. These plans will be available for sale again on November 15, 2014 with effective dates beginning January 1, 2015.

Depending on what your 2014 total household MAGI - Modified Adjusted Gross Income - will be, you may qualify for a significant federal subsidy under the new health care law to lower your premiums. The next date to find out is November 15, 2014 when Medal renewable health insurance plans are available again for sale during the next open enrollment period.

If your 2014 total household MAGI - Modified Adjust Gross Income - will be lower than:

$46,960 for an individual
$62,040 for a couple
$78,120
for a family of three
$94,200 for a family of four
$110,280 for a family of five
$126,360 for a family of six

you will be better off financially by buying a new health insurance plan inside the health insurance exchange implemented by the PPACA - "Patient Protection & Affordable Care Act" - otherwise known as "Obamacare". By doing so, you
will qualify for an APTX - Advance Premium Tax Credit (federal subsidy) - to reduce the cost of either the Bronze, Silver, Gold or Platinum health insurance plans offered inside the health insurance exchange.

Click the Humana logo below to apply for coverage with Humana inside or outside of the new health insurance exchange. These plans will be available for sale again on November 15, 2014 with effective dates beginning January 1, 2015. Humana is not offering temporary health insurance coverage between open enrollment periods in 2014.

Click the Aetna logo below to apply for coverage with Aetna inside or outside of the new health insurance exchange. These plans will be available for sale again on November 15, 2014 with effective dates beginning January 1, 2015. Aetna is not offering Temporary health insurance between open enrollment periods in 2014.
 

Blue Cross Blue Shield of Illinois also offers temporary health insurance coverage. However, like most other carriers they only cover up to $500 of coverage for outpatient prescription drugs after you have paid your calendar year health plan deductible. Blue Cross also only allows annual payments for temporary coverage. Click their logo below to shop for temporary coverage with BCBS of Illinois.



Click the "Health Care Reform" banner below to shop for renewable Medal health insurance plans from all carriers in all 50 states both on or off the health insurance exchange.
These plans will not be available for sale again until November 15, 2014 with effective dates of January 1, 2015.

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The next wave of Obamacare horror stories won't be about cancellations

The last quarter of 2013 was filled with horror stories of millions of Americans - many of them Cancer patients - losing their health insurance because of the PPACA "Obamacare". Even though Barack Obama promised "if you like your plan you can keep your plan and no one will take it away from you, period." At the very least, many of the 6.3 million policy holders who had their coverage canceled were able to obtain a QHP - 'qualified health plan' - on a guaranteed issue basis (no preexisting conditions) as a replacement shortly thereafter. Albeit those plans are often times more expensive and expose those consumers to higher premiums and out of pocket risk exposure, most especially if they do not qualify for taxpayer funded 'advance premium tax credits'-  to artificially lower premiums and 'cost sharing' subsidies to lower deductibles.

That was then, this is now.

The new wave of Obamacare horror stories will begin being told all across America now that we are outside of the first national 'open enrollment' period which ended on 3/31/2014. Only this time it won't be about Americans losing their health insurance. It will instead be about the vast majority of Americans being unable to purchase individual, renewable health insurance from any carrier no matter how sick they are until January 1, 2015. That's right, unlike before Obamacare when you could blame those "evil health insurance companies" for "denying you your right to health care." Now, the blame will rest squarely on the shoulders of the greatest health insurance salesman in world history, Barack Obama.

Millions of Americans are about to be denied their 'right' to health care.

It is Barack Obama's health care law that will be directly responsible for denying millions of sick Americans their 'right' to health insurance from now until January 1, 2015. From now until then Americans who wish to purchase their own individual, renewable health insurance are barred by federal law from doing so. In fact, the only way to do so now is you have a 'qualifying life event' and as such qualify for a 'special enrollment' period. Understand that the 'qualifying life events' listed below apply only to those who qualify for subsidies and as such can plead their case to the decision makers at Healthcare.gov. The truth is under Obamacare your 'right' to health care refers to beseeching yet another group of nameless, faceless government bureaucrats who may or may not let you purchase health insurance that will cover your preexisting conditions. Yeah, this is going to be great! Forward!

Sarah

The rest of us in the individual market will be barred by federal law from obtaining our own health insurance that covers preexisting conditions until January 1st, 2015. It is from this pool of millions that the new horror stories will come from. Imagine you are a low information voter who doesn't vote at the ballot box but votes for American Idol candidates every year.  Then, imagine you develop cancer or another life threatening illness in May and find out that you can't get health insurance coverage that covers your preexisting condition for another 7 months. Yeah, 2014 is going to be a great year politically for Republicans. Not even they can screw this gift up.

       Examples of qualifying life events are:

  • You move to a new area that offers you different plans, or isn't covered by your HMO network.

  • You get married.

  • You have or adopt a child.

  • You lose other health coverage due to job loss, a decrease in work hours, end of COBRA coverage or other reasons.

  • You become a U.S. citizen.

  • Your income changes, or some other event changes your income or household status.

  • You can prove that your health insurance company violated its contract with you.

  • You are no longer covered on a family member's policy because you turned 26, you have legally separated from or divorced your spouse, or the policy holder has passed away.

  • You become a member of an Indian tribe. Other complicated cases that may qualify for a special enrollment period

  • You faced a serious medical condition or natural disaster that kept you from enrolling. For example:

    • An unexpected hospitalization or temporary cognitive disability

    • A natural disaster, such as an earthquake, massive flooding, or hurricane

    • A planned Marketplace system outage, such as Social Security Administration system outage

    Misinformation or misrepresentation Misconduct by a non-Marketplace enrollment assister (like an insurance company, navigator, certified application counselor, or agent or broker) resulted in you:

    • Not getting enrolled in a plan

    • Being enrolled in the wrong plan

    • Not getting the premium tax credit or cost-sharing reduction you were eligible for

    Enrollment error Your application may have been rejected by the insurance company’s system because of errors in reading the data, or some of the data was missing or inaccurate. System errors related to immigration status An error in the processing of applications or system caused you to get an incorrect immigration eligibility result when you tried to apply for coverage. Display errors on HealthCare.gov Incorrect plan data was displayed at the time that you selected your health plan, such as benefit or cost-sharing information. This includes issues where some consumers were allowed to enroll in plans offered in a different area, or enroll in plans that don’t allow certain categories of family relationships to enroll together. Medicaid/Marketplace transfers

    • If you applied for Medicaid through your state, or were sent to Medicaid from the Marketplace, but you weren’t eligible for Medicaid.

    • Your state transferred your information to the Marketplace but you didn’t get an answer about your eligibility and/or didn’t get enrolled before March 31.

    Error messages Your application was stopped due to specific error messages. For example, you received a "data sources down" error message or another error message that didn’t allow you to enroll. Unresolved casework You’re working with a caseworker on an enrollment issue that didn’t get resolved before March 31. Victims of domestic abuse You’re a victim of domestic abuse and weren’t previously allowed to enroll and receive advance payments of the premium tax credit separately from your spouse. You’ll be able to do so now. Other system errors Other system errors that kept you from enrolling, as determined by the Centers for Medicare & Medicaid Services

You can still buy health insurance in the individual market but it won't cover your preexisting conditions

Nonrenewable 'short term' or 'temporary' individual health insurance policies are still available for sale but they will not cover your preexisting conditions. And, only a few health insurers are still offering them.  Some of the biggest players in the market such as Aetna and Humana are not offering temporary plans. Of the few carriers who still are, I recommend Assurant Health for unlike other carriers Assurant Health covers outpatient prescription drugs the same as any other illness. Other carriers do not. To get quotes for temporary health insurance coverage from Assurant Health click their banner below:

Assurant Short-Term Logo

You will owe a non compliance 'fine' (TAX) to the IRS for taking the short term route

You must also understand that you will be subject to a 1% of your MAGI 'fine' (TAX) for purchasing temporary health insurance since these plans do not include the "essential health benefits" under Obamacare such as Maternity for 62 year old women and single men, drug rehab coverage for those who do not own a crack pipe and pediatric dental for those without children. As such temporary policies are not considered 'qualified health plans'. Rest assured though, if you are self employed and do not over pay your taxes you will never pay that 'fine' (TAX) for the only recourse the IRS has to collect that fine is to hold your tax refund. All criminal penalties for non compliance were removed from the health care law prior to passage.

The other kind of health insurance that will cover preexisting conditions outside of open enrollment

The other option if you need coverage for preexisting conditions outside of open 'enrollment' is to purchase small group health insurance which is available to groups of two or more people.  However, you must be incorporated and take a Schedule K as an owner of the company. Also, if you are already sick the policy will be max rated and with most carriers if you are going to add employees they must be W2 employees not 1099 contractors.

How long can I keep my child on my health insurance plan?

Long before the
Patient Protection and Affordable Care Act(a.k.a. “Obamacare”) was signed in to law on March 23rd, 2010. There were Federal & State laws that were already in force around the country that provide protection for dependent children regardless of their college student attendance status. There were also multiple existing laws that guarantee coverage for pre-existing conditions for all Americans.

In fact, the PPACA legislation does NOT include protection for dependent children regardless of college student eligibility status until 2014. Neither does it guarantee access to health insurance coverage regardless of pre-existing conditions until the year 2014. Even though, the President stated repeatedly that “within 6 months of the signing of this legislation, dependent adults will be able to stay on their parent’s policies until 26 years of age and children will no longer be denied coverage for a pre-existing condition“.

Thanks to America’s Health Insurance Plans (who had already suggested such legislation in 2008) children will not have to wait until 2014 to obtain guaranteed access to health insurance coverage for pre-existing conditions so  long as they are insured on a parent’s policy. This is true because America’s Health Insurance plans voluntarily  agreed to do so in 2010 instead of waiting until 2014.

Thanks to this agreement, as of 9/23/2010 all 'adult dependents' can now remain on their parent's health insurance policies until the age of 26 without the need to be attending college. Blue Cross Blue Shield lists all of the other mandates that were added to health insurance policies as of 9/23/2010 under the PPACA as well.

In addition, 65 new Preventative Care mandates have also been added to all “non grandfathered” health insurance plans (plans purchased after March 23rd, 2010).

Another law that was passed by Congress in 2008 also protects college students. Such as Michelle’s Law (H.R. 2851) which requires insurance plans that use student status to determine dependent eligibility to allow dependents to take up to 12 months of medical leave without jeopardizing their eligibility. More than 20 percent of states had enacted similar laws prior to federal action.

Then there are COBRA Continuation Coverage Rights which were passed more than 14 years ago in 1996. Under these laws, a dependent child will become qualified for COBRA benefits if they lose coverage under their parent’s employer-sponsored insurance (20 employees or more) if:

1. the parent/employee dies;
2. the parent/employee’s hours of employment are reduced;
3. the parent-employee’s employment ends for any reason other than his/her gross misconduct;
4. the parent/employee becomes enrolled in Medicare;
5. the parents become divorced or legally separated; or
6. the child stops being eligible for coverage under the plan as a “dependent child.”State Actions

Click here to see State laws that existed long before the PPACA (Obamacare) that provided continuation of coverage for adult dependents regardless of their college attendance.

Health Insurance subsidies for spouses who have access to employer-sponsored coverage.

Question: I work for a public school in which my employer pays for my health insurance. My wife is a homemaker and is on my insurance, but I pay the entire premium. My gross income last year was 27,000. Can my wife leave the insurance she currently has and shop on the exchange?

Answer: The IRS has ruled if one has “access” to employer-sponsored coverage they are not eligible for premium assistance in the exchange. So your spouse can opt out of your group coverage and shop at the exchange, but she will not be eligible for a subsidy.

Medicaid recipients can not receive a subsidy to purchase actual health insurance

Question: I went to the health insurance marketplace and found out I qualify for Medicaid. I don't want Medicaid, I want private health insurance. Can I qualify for a still qualify for a subsidy to buy private health insurance?

Answer: No, the PPACA (Obamacare) law prohibits anyone who qualifies for Medicaid from receiving a subsidy to lower the cost of private health insurance inside the "Health Insurance Exchange Marketplace".

Same-Sex Combined Income in Exchange?

Question: I am self employed and qualified for low income insurance through my state. My girlfriend/soon to be wife’s company does not offer same sex marriage health insurance. if I get married I will lose my insurance through my state because they use her income as part of the application process. If I apply for the insurance in January under the Obama care will it be just my income or will it be our income combined? She does not need coverage it would be just myself.

Answer: After the DOMA ruling, your partner’s employer must offer coverage for married same-sex couples at some point (assuming your state allows same-sex marriage), probably not until the group’s next open enrollment. Obamacare will treat you as a couple only if you file income taxes jointly. Being treated individually will be better for you if you have a lower income than your partner, you may qualify for premium assistance in the exchange. She will not because she has access to affordable group coverage.

Exchange Coverage for Spouse?

Question: If I am currently on my spouse’s insurance can I deny insurance coverage from my current employer under new Obama health care plan? My employer is saying no that I cannot deny and would have to go to part time to avoid that.

Answer: Yes. You can drop off your spouse’s employer-based coverage and enroll in the Exchange, but you will not be eligible for premium assistance because you have access to employer-based coverage. The employer would have to exclude all spouses and children from coverage in its group plan for the dependents to be eligible for subsidized coverage in the Exchange. It is only when the insured’s employee-only cost exceeds 9.5% of income that the coverage is deemed not “affordable”, making the entire family, including the employee, eligible for premium assistance in the Exchange.

"Obamacare" Maternity

Question: I have insurance under my mother’s policy, with no maternity. My due date is in mid January, 2014. Does this mean that I can get insurance right before my birth to cover my hospital expenses?

Answer: Yes. Your new coverage can be effective January 1, 2014. Coverage includes maternity and there are no waiting periods.

Can I Remove My Spouse from My Insurance and Have Her Buy Individual Insurance on the "Health Insurance Exchange Marketplace?"

Question: My wife is a small business owner, and is covered under my policy. However, the cost of covering her is exorbitant. Can she opt out of my coverage and buy her own policy on the new exchanges?

Answer: Your wife can purchase individual health insurance on the state exchange, but she will not be eligible for a subsidy because she has access to employer-based health insurance through your employment. The exception to this rule is if your shared contribution to your own coverage (employee-only) exceeds 9.5% of your income. In that case you and your spouse may be eligible for an advance tax credit in the exchange.

Spouse Must be on Own Employer's Insurance

Question: My husband recently changed jobs, and his new employer states that if my employer offers a group plan and I am eligible than I can not be on his plan, because of a “life change” I can enroll in my company’s plan but he and the kids can be on his plan….is this actually legal?

Answer: Yes.

Stay on Cobra in 2014?

Question: I am currently on cobra which will last till i go on Medicare. will i be forced to get ins. from an exchange in 2014 or can i stay on cobra, if i so desire? thank you

Answer: You can stay on COBRA if you wish, but I suggest you take a look at coverage offered in your state exchange. You might get better coverage for less money especially if you qualify for a premium subsidy.

Opting Out of Employer Insurance for Obamacare

Question: When Obamacare comes along can I drop my insurance through my employer and buy my own policy that meets my needs? Our current coverage is horrible.

Answer: Yes. You can opt out of your employer-based insurance and buy a plan in your state exchange, but you will not be eligible for a premium subsidy if you have access to “affordable” employer-sponsored health insurance. To be considered affordable, your contribution toward the employee-only coverage must be less that 9.5% of your income.

Obamacare Rates: How High Will They Go?

Question: I read an article that said rates of individual insurance would go up as much as 60%. Won’t that erase the savings from subsidies?

Answer: A new study released by the nonpartisan Society of Actuaries estimates that individual premiums will rise 32 percent over 2013 rates on average nationwide within three years, 2014 - 2016, partly as a result of higher risk pools (more sick people in then insured population). Changes would vary by state, from an 80 percent hike in Wisconsin to a 14 percent reduction in New York. For anybody eligible for subsidies, their contribution to the total premium is fixed on a range between 2% and 9.5% of income. So, for the subsidized, it doesn’t make any difference what the final rates are. On an individual basis, age and income will determine how much of an increase. The subsidized group are likely to pay about 47% to 84% less in monthly premiums compared to 2013. The un-subsidized young (below 40) and will see the highest premium increases. Some of older un-subsidized group will have lower premiums than today for better coverage. On a positive note for the un-subsidized, coverage will be more comprehensive for all, meaning less out-of-pocket costs thus reducing the impact of higher rates

Subsidy for Spouse

Question: I’ve opted to have an individual health plan because, being in good health, it’s less expensive than buying into my spouses employer plan. As an independant contractor, will I be eligible for a health insurance tax subsidy if our family income is low enough?

Answer: The ACA says that someone with access to “affordable” employer-sponsored coverage cannot get a premium subsidy from state exchanges in 2014, unless the cost of the employer-based health care coverage for that employee exceeds 9.5 percent of the worker’s household income. The IRS ruled recently that the calculation of affordability will be based on the cost of employee-only coverage, not family coverage. For example, if your spouse contributes $300 each month or $3600 for the year for his or her portion of the premium for the employee only, Your family income would have to be less than $37,895 per year no family member would qualify for a subsidy even though they are not covered by the spouse’s group plan.

Age 26 and PPACA - Patient Protection & Affordable Care Act

Question: My child is younger than 26 and i want to remove him from my health insurance. Can i do that under the affordable health care act?

Answer: Yes. Covering your child to age 26 is an option provided by the ACA. It is not a requirement. In 2014, everyone will be required to have health insurance. If your child does not have coverage, they may have to pay a penalty.

Obamacare or Employer Plan

Question: If i lose my health insurance thru my husband’s employer do i have to take one offered thru my employer or can i take one thru the health care exchange?

Answer: If your employer offers group health insurance coverage that is “affordable” you should take it, because you will not be eligible for a premium subsidy in the state Health Insurance Exchange.

Disabled Son Eligible for Obamacare

Question: My son turns 26 next year and is disabled with Lyme disease and cannot work (no financial income). Currently, he is covered under my work insurance plan. What options does he have when he can no longer be on my plan.

Answer: Your son will be eligible for coverage in your state health insurance exchange on January 1, 2014, as would any legal resident of your state regardless of medical conditions. You don’t have to wait until he is 26. His income will determine whether he is eligible for Medicaid or subsidized private coverage.

When Can I Enroll in the Exchange?

Question: I am 60 and retired. I kept the retiree insurance offered by my previous employer while waiting for a response from an individual insurance application for a plan that was half the cost. I was denied insurance based on pre-existing conditions. It is VERY difficult to continue paying these premiums ($600)and would like to know if I will be able to enroll through an exchange in the fall of 2013 for the 2014 implementation of the health care act, or will I have to be uninsured to do so?

Answer: Yes. You will be able to enroll in a ACA conforming health plan through your state exchange anytime after 10/1/13 and your new coverage will be effective on 1/1/14.

Eligible for Medicaid in 2014?

Question: I am a single mom with 2 children. I make about $20,000. We don’t have insurance now. We don’t qualify for Medicaid because I have some savings. Can we get health insurance through the exchange if we do not qualify for Medicaid due to assets?

Answer: Starting in 2014, Medicaid will no longer consider assets, only income. So based on your income you will be eligible for free public health insurance from Medicaid. If you choose to opt out of Medicaid in favor of Exchange coverage, you cannot also be eligible for subsidized coverage. You would have to pay the full premium and I don’t think that will be practical for you.

Better Coverage in 2014?

Question: We currently have an Aetna PPO through my employer. My spouse is 53 and has a chronic illness. So far she is doing okay, but our fear is that when I retire next year, and we shop from the exchange, the potential treatment she may need won’t be as good as what I currently have with Aetna. That our options for treatment will be limited. Are these fears unfounded? Will the latest treatments be available?

Answer: The quality of health insurance coverage in 2014 will actually be better - more comprehensive and with fewer restrictions - than it is now as a result of health insurance reforms imposed by the Affordable Care Act.. You can still purchase an Aetna PPO plan if you so choose, either in the state exchange or the outside marketplace.

Will the Individual and Shop Exchange Offer the Same Plans?

Question: Will the SHOP exchange will offer the same qualified health plans as the individual exchange?

Answer: The ACA leaves this up to the states. In some states, like California, there will be two separate exchanges one for individuals and one for small-businesses and both exchanges must offer the same standardized plans. In some states the two exchanges may be combined.

Who Gets Subsidized?

Question: Who will be eligible for premium subsidies in the health benefit exchange in 2014?

Answer: Legal residents, under 65, and not incarcerated will qualify for subsidies called advanced premium tax credits in 2014, if their taxable household income (MAGI - Modified Adjusted Gross Income) is between 133% percent and 400% percent of the federal poverty level. The amount of the subsidy decreases as income increases.

Obamacare Catastrophic Coverage?

Question: Will there catastrophic coverage under Obamacare?

Answer: Yes. But the catastrophic plan can be offered only only for young adults, those under age 30 before the plan year begins. The catastrophic plan will be the lowest priced health plan available within the guidelines of essential benefits. Catastrophic plans will have an actuarial value of about 60% (bronze level). The deductible and out of pocket maximum will be $6400 per year.

What is the Individual Mandate Penalty?

Question: What is the individual mandate health care reform amount of tax?

Answer: The Affordable Care Act (ACA) specifies that the “applicable dollar amount” of the tax is $695 per adult to be phased in and adjusted as follows:

  • In 2014, the penalty is $95 per adult and $47.50 per child (up to $285 per family) or 1% of family income, whichever is greater.

  • In 2015, the penalty is $325 per adult and $162.50 per child (up to $975 per family) or 2% of family income, whichever is greater.

  • In 2016, the penalty is $695 per adult and $347.50 per child (up to $2,085 per family) or 2.5% of family income, whichever is greater.

Who Pays First?

Question: Who is primary when there is adult dependent on both parents policy and parents are divorced?

Answer: Coordination of Benefit Rules were codified by the National Association of Insurance Commissioner in 1986 and each state uses this model with some modifications. The rules cover how the primary payer is determined when an insured employee or dependent has double coverage. To determine who pays first on dependent children’s claims, the plan covering the parent whose birthday is earlier in the calendar year is primary.

ATTENTION Main Stream Media. Regarding Obamacare, I TOLD YOU SO!

Back on August 3rd, 2013 I wrote a piece exposing what I stated then will soon happen to millions of Americans if we do not support the Tea Party and Republican lead effort to defund Obamacare. In that piece, I stated when President Obama promised – “If you like your plan, you can keep your plan and no one will take it away from you, period” he was not telling the truth. Watch President Obama make this false promise below:

Below I will link to some real world examples of what is beginning to happen because the Obamacare “Health Insurance Exchange Marketplaces” opened on 10/1/13 and were funded (once again) by Republicans in the most recent Continuing Resolution on the evening of October 16, 2013.

Below I will link actual policy termination letters from four of my existing clients who hold individual health insurance policies from Blue Cross Blue Shield of Illinois. The last names and policy numbers have been redacted in order to protect the privacy of these clients per 1996 HIPAA law.

Click here to download Stephen’s Obamacare termination letter.
Click here to download Robert’s Obamacare termination letter.
Click here to download Kathleen’s Obamacare termination letter.
Click here to download Michael’s Obamacare termination letter.

Please also note that in every case, the PPACA compliant ‘replacement plans’ offered to these clients are priced higher and in most cases much higher than what they are paying now. However, they’re not just priced higher, they expose these clients to a much higher out of pocket risk each year. Up to $12,700 for a couple and a family. Below are the outlines of coverage for each PPACA compliant alternative plan offered to these clients:

The Blue PPO Bronze 005. Click here to view the outline of coverage.
The Blue Bronze PPO 006. Click here to view the outline of coverage.
The Blue Choice Silver PPO 003. Click here to view the outline of coverage.
The Blue Choice Bronze PPO 005.
 Click here to view the outline of coverage.
The Blue Choice Bronze PPO 006. Click here to view the outline of coverage.

Secondly, here is a sample copy of a letter that my Humana individual and family policy holders are now receiving. They too are now being forced into the Obamacare exchanges either on 12/31/2013 or on 12/31/2014 depending on when they purchased their health plan.  Notice that this client’s Obamacare replacement plan will triple his premium.

Thirdly, here is a sample copy of a letter that my Aetna clients are already receiving. These clients are now losing their individual and family health insurance plans. They too will be forced into an Obamacare compliant plan as of 12/30/2013 or 12/31/2014 where the cheapest – “Bronze” plan – will expose a couple or a family to a $12,700 out of pocket risk exposure each year for in network covered charges.

Fourthly, about a month after I penned my original piece on August 3rd, other Blue Cross associations all over the country began sending our their policy termination letters. You can see the Independence Blue Cross policy termination letter if you click here.

Click here to read another policy termination notice and Obamacare compliant replacement letter from Regence Blue Shield of Nebraska. Pay particular attention to $12,700 annual out of pocket expense risk that this family will now face when they are forced to switch to an Obamacare compliant “Bronze” plan on 12/30/2013. Notice that their premium doubled as well.

Notice the out of pocket costs with each of those plans? Every one of them has a higher out of pocket risk to this client than the risk his family assumes now and all of them are more expensive than what he pays now. With the exception of the “Bronze PPO 006″ plan which more than DOUBLES his family’s out of pocket risk exposure on his current “HSA 100%” plan.

One thing you can be sure of, all Individual and Family health plans sold in Illinois by Blue Cross Blue Shield, Humana and Aetna after March 23, 2010 a.k.a. ‘non-Grandfathered’ plans will be terminated and replaced with an Obamacare compliant plan either by 12/31/2013 or by 12/31/2014 depending on when you purchased the plan. Also, since the aforementioned June of 2010 ruling was a federal ruling, this will be the case for any carrier who offers plans inside the exchanges in all other states as well.

Millions of individual and family health insurance plans have already been terminated and 16 million more Americans will soon lose their individual health insurance plans because of Obamacare.

CBS News: "2 million Americans have already received policy cancellation notices. This is just the beginning."

CBS News finally reports on the true cost of Obamacare approved health insurance:

CBS News: Also reporting on hundreds of thousands losing their health insurance plans because of Obamacare:

CBS News: “Obamacare resulting in dropped coverage and higher premiums.

NBC News: Consumers facing sticker shock and policy cancellation notices due to Obamacare.

Kaiser Health News: Thousand of consumers getting insurance cancellation notices due to health law.

NBC News: Thousands getting health insurance cancellation notices.

NBC News: Half a million Californians losing their health insurance plans because they don't comply with Obamacare.

The worst part about all of this is that NBC News is now reporting that President Obama knew, as early as July of 2010 that millions of Americans would lose their health insurance plans because of his health care law:

Below is a photocopy of a page of the federal register that proves that the Obama administration knew in 2010 that millions of Americans would lose their Individual & Employer Sponsored health insurance plans because of Obamacare. This regulation was written on purpose so that millions of existing policy holders would be forced to purchase health insurance inside the exchanges instead. The forced addition of millions of these policyholders – all who were assured by president Obama that they could ‘keep their plan‘ – will lower the cost or further subsidize the high cost of insuring sick people who will most certainly be purchasing subsidized health insurance inside the exchanges. In other words this was a deliberate action taken by HHS and a direct violation of the president’s promise.

Proof

President Obama is also falsely referring to these canceled plans as “substandard plans” from the ‘old market’. Nothing could be further from the truth. These plans were designed in large part by his health care law. All individual plans sold since 9/23/2010 already include 8 out of the 10 “Essential Health Benefits” that he states must be “added’ in January of 2014 in order to make them ‘better’. In fact, my clients who selected Maternity coverage with Blue Cross Blue Shield of Illinois already have 9 out of the 10 “Essential Health Benefits”. Yet the President’s health care law requires that these plans must also be terminated and replaced with even more expensive plans in 2014. The evidence in this post prove that these plans are far from ‘substandard’ plans from the ‘old market’.

Remember, president Obama also promised rates would go down by $2,500? Watch him make that promise here:

San Jose Mercury News: Two time Obama voters and strong supporters of the "Affordable Care Act" shocked to receive policy cancellation notices and massive premium increases.

You can run your own Obamacare compliant rates by clicking on my Blue Cross Blue Shield of Illinois quote engine below:

If you’re not in Illinois, you can run your own Obamacare approved rates using my Humana quote engine here:

Please note: There is one major difference between my online quote engines and the “Health Insurance Exchange Marketplace” at HealthCare.gov. Mine actually work!

Months after I penned that original article – on August 3, 2013 – a flagship member of the main stream media – NBC – finally confirmed in their article entitled  Thousands get health insurance cancellation notices that I was indeed speaking the truth and not a ‘fear-mongerer’, ‘racist’ or ‘liar’ as I have been labeled repeatedly by our ‘friends on the Left’ since writing that piece.

Several days before NBC finally confirmed I was right. A newspaper in California detailed the anger and frustration by two time Obama voters who were also losing their health plans and facing an increase in their family premium of $10,000 a year. You can read that California newspaper piece if you click here.

Oh and it’s not just individual and family policy holders who are losing their health insurance policies because of Obamacare. It’s employer sponsored group policy holders as well. Click here to see a copy of the California Farm Bureau Federation group policy termination letter sent to their insured members. The CBO is predicting that 14.5 million Americans will lose their health plans after 2014. I disagree. I am predicting more than 40 million Americans will lose their employer sponsored health insurance plans. I discussed why for the Fox Business television network. View the video on the Fox Business web site by clicking here:

Worse yet, those whom we count on to provide us with the care we need are also losing their health insurance plans because of Obamacare. Here is a letter that doctors and dentists in Illinois received all over the state. They too will be losing their health insurance plan as of 12/31/2013.

All of these policy holders are being forced to forfeit their existing plans and agree to accept an Obamacare compliant plan (along with the premium increases required) by December 31, 2013 or December 30, 2014 depending on when they purchase the plan. I discussed this for the Fox Business television network on 09/30/2013 the day before the Obamacare "Health Insurance Exchange Marketplace" opened.

Why is this happening now?

I will use the state of Illinois as an example. Governor Quinn had originally expected 16 health insurance carriers to offer products within the Illinois Obamacare exchange. Only 6 carriers have chosen to sell plans within the exchange. They are as follows:

Humana
Blue Cross Blue Shield of Illinois
Aetna
Coventry
Land of Lincoln Health
The Carle Foundation, a nonprofit hospital network based in Urbana

Since these carriers have chosen the option to offer a “Medal” (Bronze, Silver, Gold or Platinum) product within the exchange, individual/family health insurance plans that they have already sold in 2010, 2011, 2012 and 2013 must be terminated and replaced with a plan that conforms to the design of the “Medal” plans sold inside the exchanges. These new replacement plans must include all 10 of the federally mandated “Essential Health Benefits” and they must conform in design to the deductible and other out of pocket expenses that will be included with the “Medal” plans sold inside the exchanges.

There are however two large insurance carriers that are staying out of the new Obamacare “Health Insurance Exchange Marketplace” in Illinois and most other states. Those carriers are United HealthOne and Assurant Health. Because these two carriers are staying out of the exchange, the PPACA (Obamacare) law allows them to continue to design their products differently than the plans sold within the exchange.

Although these two carriers must still adopt all 10 of the new federally mandated “Essential Health Benefits” and they must also offer guaranteed insurability (no preexisting conditions) to all applicants during ‘Open Enrollment” periods. The deductible and coinsurance arrangements that they can offer to their clients can be higher than the standard deductibles and coinsurance arrangements that will be offered in the exchanges

This means that their prices will be inherently lower than the “Medal” plans sold inside the exchanges. This is most especially true for individuals with MAGI – Modified Adjusted Gross Incomes – higher than 400% above the Federal Poverty Level. That would be $46,000 a year for an individual, $62,000 for a couple and $94,200 for a family of four. These Americans will receive no taxpayer funded ‘subsidy’ to artificially lower the cost of the expensive health insurance plans that will be sold within the new health insurance exchanges.

Because these two carriers are staying out of the Obamacare exchange. Not just here in Illinois but around the country. They are both able to make the following commitment to potential new policy holders. If you purchase a health insurance plan from either of these carriers prior to 2014 you will not lose or have to change that health plan and you will not receive a premium increase until December 30, 2014.

Watch United HealthOne make this promise here.

Run your own quotes from United HealthOne by clicking on their logo below:

http://www.a1insuranceaz.com/images/carriers/united-health-one.png

Run your own quotes from Assurant Health by clicking on their logo below:

It’s not just health plans that have been terminated. We’ve lost 13 carriers as well. In July of 2013 we lost the 13th individual health insurance carrier since Obamacare passed. See this insurance company’s exit letter here. The other individual health insurers who have pulled out of the individual health insurance market since the passage of Obamacare are as follows:
 

1.) American National
2.) American Republic > 35,000 people LOST their health plans when American Republic exited the market. Hundreds of jobs were lost as well.
3.) American Medical Security
4.) American Community Mutual
5.) Standard Life & Accident
6.) Principle Financial
7.) nHealth
8.) World Insurance
9.) Unicare

10.) Guarantee Trust Life < One of my clients in Naperville, Illinois who received that letter lost her plan during Breast Cancer treatment!
11.) Coventry
12.) Physicians Benefit Trust
13.) Independence Holding Group

Obamacare is creating a massive insurance monopoly. These smaller carriers that I used to be able to offer to my clients, the carriers with the good prices are now gone. They are being gobbled up by the larger carriers. We now have only a handful of health insurance carriers left in the country. Think about it, you know this. Look at the exchange plans and see if you can find more than 5 carriers who are offering plans.

Eliminating health insurance carriers and creating a taxpayer funded monopoly is not ‘competition’. It is a monopoly and nothing drives up prices like a monopoly. Period.

"Open Enrollment" under Obamacare. What do I need to know now?

Beginning 1/1/14 and ending 4/1/14 the first national 'Open Enrollment' period begins under Obamacare. During this 'Open Enrollment' period, applicants will be able to purchase health insurance coverage on a guaranteed issue basis (without regard to preexisting conditions) from any carrier in the country that offers a QHP - 'Qualified Health Plan'.

Providing you live in a state that opens their exchange on schedule, you will be able to begin shopping for QHP's on 10/1/13, albeit coverage can not begin until 1/1/14. After this first national Open Enrollment period ends on 4/1/14 Individual & Family applicants will not be able to get coverage for preexisting conditions unless they enroll in an Employer Sponsored Group health insurance plan. Outside of that, applicants seeking individual or family coverage will have to wait until the next national Open Enrollment period which is scheduled to begin on or about 10/1/14 and end on 12/31/14. This is especially true since all state high risk pools will be dissolved and their policy holders will be forced to purchase coverage inside Obamacare exchanges. In other words, you can not 'keep your plan' as president Obama promised you could over and over again:



If your annual MAGI - Modified Adjusted Gross Income - is less than $46,000 for an individual or $92,900 for a family of four. And, you do not have qualified Employer Sponsored health insurance. You will qualify for an APTX - Advance Premium Tax Credit - to artificially lower your cost for expensive "Obamacare approved" health insurance available inside the exchanges. An APTX is nothing more than forcibly redistributed income from the few, the proud, the 51% of us who still pay income taxes. Depending on your income, your APTX may be quite significant. To find out how large of an APTX you qualify for click here. At least, this is how it was all supposed to work.

If your MAGI is above the aforementioned income levels you will be far better off purchasing health insurance from a carrier that has chosen not to offer products within the Obamacare exchanges. Most carriers have chosen not to do so. You will still be able to purchase coverage outside the exchange on a guaranteed issue basis without regard to preexisting conditions during the aforementioned national Open Enrollment period. You would simply purchase your coverage inside a private exchange. To see what a private exchange looks like click here. I have had that private exchange linked to my health insurance brokerage site for many years now. Long before Obamacare. It provides multiple comparison products and premiums from multiple carriers and it is available to consumers in all 50 states.

The reasons why those with income levels above $46,000 individual and $92,900 for a family of four should purchase health insurance outside the Obamacare exchanges are twofold. They are as follows:

#1) The PPACA (Obamacare) law states that it is an option for insurance carriers to offer products within an Obamacare exchange. In the state of Illinois, only 5 out of 16 carriers have decided to offer products inside Illinois' Obamacare exchange. The other 11 carriers made the decision to stay out of the exchanges because by staying out, they retain the ability to design products that are different in design than those offered inside the exchanges. For example, only young people under the age of 30 can purchase a low cost, high deductible "Catastrophic" plan inside the exchanges. Outside the exchanges, everyone can purchase a low cost, high deductible "Catastrophic" plan. Regardless of their age and better yet they can tie a tax deductible, tax deferred, interest bearing HSA - Health Savings Account - to it.

In other words, so long as a carrier chooses not to offer any plan inside the Obamacare exchanges. They retain the ability to offer more attractively priced plans outside of the exchanges in a private exchange. If they decide to offer just one plan inside the Obamacare exchanges then all plans they sell outside of the Obamacare exchanges must conform or "metalize" to the 'metal' plans offered inside the Obamacare exchanges. This of course will drive up the costs of all of their plans exponentially.

2.) Because carriers who do not offer products inside the Obamacare exchanges retain some level of control in the design of products they offer outside of the Obamacare exchanges. It behooves consumers above the aforementioned MAGI levels to purchase those plans instead. For those plans will be priced lower and in the majority of states, much lower.

July 5, 2013 UPDATE: Well that didn't take long. On the eve of the same day I wrote this piece. HHS published yet another 'new rule' that states they will no longer require you to prove your income OR if you have employer sponsored health insurance in order to get APTX - Advance Premium Tax Credits to artificially lower the expensive health insurance in the Obamacare exchanges. Instead, applicants will answer those questions on the 'honor system'. Of course, if you report the wrong income levels on your Obamacare application, you will be subject to fines of up to $25,000 and you'll owe the IRS on the following year. This makes Obamacare ripe for fraud and will massively increase the CBO's projected costs for this legislation.

Why Are Health Insurance Premiums Still Increasing After The PPACA?

There are 5 primary reasons why health insurance premiums have already increased and will continue to increase since the passage of the PPACA. And, why insurers like Aetna are expecting some premiums to double after 2014.

society of actuaries

1.) My Blue Cross Group clients have received policy renewal rate increases since the passage of the PPACA of up to 46% for the first time in 17 years. See just a few of them here. Their prior premium increases were nothing near this amount. This is not isolated to Blue Cross either. These premium increases are happening in many markets across the United States in both the Individual and Group health insurance markets. Even though Barack Obama promised “my health care plan will save the average family $2,500 on their premium.”

And then their was this quote from Barack Obama: “It’s estimated that your employer’s premiums will fall by as much as 3,000% which means they could give you a raise.”

These premium increases are due in large part to the fact that multiple new “Preventative Care” mandates were imposed upon all “non-grandfathered” health insurance plans as of 9/23/2010 under the PPACA (Patient Protection & Affordable Care Act). A “Non-grandfathered” health insurance plan is a plan that was purchased after the PPACA (a.k.a “Obamacare”) was signed in to law on March 23, 2010. Keep in mind, these were ALL mandated to be covered no later than 1/1/2011 WITHOUT a co pay or a DEDUCTIBLE (a.k.a. “free”). The entire list is as follows:

2.) Now for the policy “design” Mandates. Blue Cross outlines those here:
http://www.resourcebrokerage.com/BCBSupdates22510B/PPACAILInsuredNotification.pdf
 

3.) The recent inclusion of PPACA mandated “Essential Health Benefits”. Among these are the following:

4.) Now we come to reason number four. The rapid implementation of the PPACA mandated Medical Loss Ratios – which were implemented on 9/23/2010 -  have resulted in more than 13 health insurance carriers closing their doors or refusing to sell health insurance again.

This has left thousands of American’s either uninsured or without the plan they had prior to the passage of the PPACA. Here’s sample letter that many of my clients received when Guarantee Trust Life insurance company ceased providing health insurance to my clients around the country.

This is exactly the opposite of what President Obama promised when he said in his speech to the AMA on June 15, 2009 “If you like your health care plan, you will be able to keep your health care plan. Period. No one will take it away. No matter what.” Watch him make this promise below:

Find out the names of the carriers that have left the industry since the passage of the PPACA as well as all the other damage done to the health insurance industry since the passage of the PPACA by reading the new study completed by the Galen Institute on December 1, 2011 entitled “A Radical Restructuring of Health Insurance.”

World Insurance company in Omaha, Nebraska and it’s subsidiary American Republic insurance company is the latest carrier to succumb to the PPACA’s onerous Medical Loss Ratio requirement. Read the story here. Both companies will be purchased by Celtic Insurance company of Chicago Illinois. This the THIRTEENTH company to pull out of Iowa’s health insurance business since June 2010. This again, is all due to the onerous MLR’s (Medical Loss Ratios) implemented on 9/23/2010 under Obamacare.

Other companies that have either closed their doors entirely or stopped selling health insurance since Obamacare was signed into law are as follows:

1.) American National
2.) American Republic
3.) American Medical Security
4.) American Community Mutual
5.) Standard Life & Accident
6.) Principle Financial
7.) nHealth
8.) World Insurance
9.) Unicare
10.) Guarantee Trust Life
11.) Coventry
12.) Physicians Benefit Trust
13.) Independence Holding Group

Other carriers are slowly withdrawing State by State. Page 7 of this white paper dated September 6, 2011 from the North Carolina Department of Insurance details exactly why the majority of all health insurance carriers that offered health insurance in their State have already exited and why even more are considering doing so shortly.

Millions more Americans will lose their Employer Sponsored health insurance come 2014. This is due to the fact that the ‘fine’ (Roberts Tax) on employers – with 50 more more full time employees – who do not offer HHS approved health insurance to their employees is only $2,000 annually. This is far less than the cost to provide health insurance. So, many employers will simply choose to pay the ‘fine’ and push their employees onto the ‘health insurance exchanges’. For the full impact of the PPACA “Roberts Tax” on Individuals, Taxpayers & Employers visit this link.

UPDATE: Even though Barack Obama has now delayed this onerous mandate on employers until 2015 the ramifications have already been realized in the latest jobs report with a massive increase in part time workers.

Historical precedent proves that forcing mandate after mandate and new regulation after regulation on to the health insurance industry does nothing but increase costs. In 1979 there were 252 mandates forced upon the health insurance industry, by 2007 there were nearly 1900. With the implementation of the PPACA  we have tipped the scales at nearly 2,262 mandates. Keep piling them on and costs will continue to rise.

5.) Premiums will continue to increase when the following additional PPACA imposed requirements begin on January 1, 2014

A.) The “minimum actuarial value” requirement that forces insurers to provide more financially generous coverage with fewer co-pays and deductibles.
B.) Thecommunity ratingprovision that forces young Americans to pay far more for health insurance in order to subsidize older Americans. This was included in the PPACA even though historical data points to the catastrophic failure of ‘community rating’.
C.) The guaranteed issue provision that forces insurers to take all comers, even if they are already sick.
D.) Theessential health benefitsmandate that forces insurers to cover health-care services that many customers wouldn’t otherwise want to pay for.

The sad truth is, even though the President promised ‘affordable health insurance for all Americans‘, many Americans will not receive health insurance at all. In fact, according to the Congressional Budget Office’s latest assessment, 30 million Americans will remain uninsured even after full implementation of the PPACA. Worse yet, 17 million more will simply be enrolled in a Government Welfare program called Medicaid. Many who do receive health insurance will receive a very large tax payer funded subsidy, which will continue to detach the consumer with the true cost of health insurance. To find out what health insurance will cost you in the PPACA ‘Health Insurance Exchanges’ click here.

On Thursday November 7, 2013 my new friend Bill Elliot appeared on “The Kelly File” with Megyn Kelly on the Fox News channel. I say “new friend” because immediately after I watched his heart breaking interview I ‘friended’ Bill on Facebook. I wanted him to know that even though his insurer was being forced to terminate his health insurance policy due to regulations posted by HHS and referred to in the Federal Register in June 2010. Three months after the PPACA - Patient Protection & Affordable Care Act (Obamacare) was signed into law. Such a posting in the Federal Register that has not been passed by Congress does not trump an existing Federal law. I will explain what law I am referring to in a moment but first please watch Bill’s testimony:



The following day Bill was interviewed by radio host Rocky D on AM1340 WQSC in South Carolina. In that interview Bill goes into detail about the type of illness he suffers from and how hopeless he felt after the president’s Obamacare took away his health insurance policy in the middle of ongoing treatment for Stage 4 Cancer. Click the MP3 logo below to hear the replay:

This is the worst time to cancel someone’s coverage. And, that is precisely why Public Law 104-191 was written and passed by Congress in 1997. It was written to protect Americans from such a situation. I am writing this article not just to help Bill but to help all Americans who are suffering from an ongoing preexisting condition. If you are one of the 5 million Americans who have already received a policy termination letter or one of the 14 million Americans who will soon receive a letter, you need to print out Public Law 104-191 and highlight section 2742 and then contact an attorney. Or, if you have access to your governor - as Bill does - (his governor is the awesome Nikki Haley) contact your governor or state Attorney General’s office because your health insurer is violating a Federal law based on a posting in the Federal register that was not passed by Congress and as such does not trump an existing Federal law.

Since Bill did nothing wrong. No fraud was committed. His health insurer is not leaving the state and they charged him more based on a preexisting condition they are in violation of Public Law 104-191 section 2742. As such, they have no legal right to terminate his coverage, regardless of a posting in the Federal register.

Want to know the best part? I just heard from Bill and after contacting Governor Nikki Haley and his insurance company and reading to them section 2742 of Public Law 104-191 his insurer has decided to keep his policy in force because he has a chronic illness. Bill just told me the following: “Steve, the company decided to keep me active. Since it is a chronic illness. Until this illness kills me. Battle #1 is won. Now the hard part. You literally saved me. Thank you so much.” Those are the greatest words I have ever heard in my 20 year career as a licensed health insurance broker. I couldn’t be a happier man today!

UPDATE #1) On November 15, 2013 Bill Elliot joined Sara Marie Brenner who covered this story in the Washington Times on November 14, 2013 to discuss how he was able to use HIPAA - Public Law 104-191 - section 2742 to require his insurer to reinstate his cancelled policy without increasing his premium or his deductible. Click the MP3 icon below to listen to the replay:

UPDATE #2) On November 13, 2013 Rocky D had me on his show on AM1340 WQSC for a follow up to explain how Bill was able to keep his policy. Click the MP3 logo below to listen to the replay: 

UPDATE #3) On November 15, 2013 I joined the Chicks On The Right on 93.1 FM WIBC to discuss the latest Obamacare disaster created by the president and Bill Elliot's policy reinstatement. Click the MP3 logo below to hear the replay:

Barack Obama is the greatest LIAR since the father of the LIE

Now let me address a lie that president Obama and other members of the Democrat party have been repeating ad nauseum since 2008. President Obama said over and over again "health insurance companies can raise your premiums when you get sick" and "health insurance companies can cancel your coverage when you get sick"? The truth is that Public Law 104-191 - has prohibited such actions by any insurer for more than 17 years. Long before Obamacare was ever written. To add insult to injury, the president told the following LIES during a joint session of congress. Watch what he said below:

Really Mr. president? Here's the truth from Politifact the Chicago Sun Times and Fox News. Watch their coverage below:

Then there was the LIE the president told about his own mother. In 2008 and again in the film created for Barack Obama entitled "The Road We've Traveled" - narrated by Tom Hanks. Watch him tell this lie in the video below:

In the book “A Singular Woman: The Untold Story of Barack Obama’s mother.” by journalist Janny Scott. Scott reviewed letters from the president’s mother – Anne Dunham – to CIGNA (the insurance company), and revealed the dispute was over disability coverage, not health insurance coverage. Disability coverage helps replace lost wages due to an illness. This story had absolutely nothing to do with her health insurer refusing to pay her medical bills. In fact, she had excellent health insurance, the hospital billed her health insurer directly and her health insurer paid her medical bills, less her deductible and applicable co pays.

Worse yet, the president described his mother as an indigent woman who was ‘pretty much drained of her resources.’ The truth is Anne Dunham received a base pay in 1995 of $82,500, plus a housing allowance and a car, to work in Indonesia for Development Alternatives Inc. of Bethesda. Today, adjusting for inflation, that salary would be equivalent to $123,500. This is far from indigent. Today, the Washington Post rightfully gives this story 'Three Pinocchios"

What about the women who the president said had her cancer treatment denied because of acne? Well, as you may have guessed by now. That too is a lie. According to ABC News, "President Obama's description that Beaton’s 'insurance company canceled her policy because she forgot to declare a case of acne' is not accurate.

As Robin Lynn Beaton's congressman, Rep. Joe Barton, R-Texas, testified, the Blue Cross/Blue Shield letter 'informed Ms. Beaton that an investigation into her claims for benefits resulted in the company reviewing her medical records in which they discovered that she has misinformed them on several pieces of information. One of them was that she did not list her weight accurately, and the other, that she had failed to disclose some medication she had taken for a preexisting heart condition."

Blue Cross discovered the previous condition after her visit to the dermatologist for acne but her insurance was not canceled because she didn't declare a case of acne."

By now, you may be asking. 'Who are you to call the president of the United States a liar?' Let me answer that. I have been a multi-state licensed health and life insurance broker for more nearly 20 years now. I have also served as a Subject Matter Expert for multiple business journals around our great country.

One of the biggest challenges I've had to deal with  throughout the years has been trying to secure coverage for people with preexisting conditions who obtain their health insurance on the individual market. They represent 10% of the American insured.

I've never had to worry about preexisting conditions with the other 90% of American insured's who get their health insurance through an Employer Sponsored Group plan. Why? Because the same Public Law 104-191 "HIPAA" has protected them against being denied health insurance because of preexisting conditions for more than 17 years

Because government legislators did not apply this law to individual health insurance policies, you can be labeled as "uninsurable" when you apply for an individual health insurance policy if you have one or more preexisting conditions. That being said, who should we truly blame for the fact that you can be denied coverage for a preexisting condition? Is it the insurance company's fault? Or are they simply following a law that was written by government law makers who did not include HIPAA portability protection for the millions of American's who purchase health insurance on their own in the individual market?

Because there are no HIPAA portability protections for individual policy holders , this uninsurable status can last for many years and sometimes for life depending on the specific preexisting condition you have been diagnosed with. Some of the preexisting medical conditions that  render an applicant uninsurable on an individual policy are: Heart Attack, Stroke, Diabetes, Cancer,  Lupus, Multiple Sclerosis, Muscular Dystrophy, Degenerative Arthritis and a host of other preexisting conditions. In addition, there are applicants who have a combination of controlled preexisting conditions but since they have more than three "ratable conditions" they are also labeled uninsurable.

Does this mean then that there was some truth in the stories the president told about preexisting conditions? No, he is still a liar. In fact, during the last 2 decades of my career as a health insurance broker I have never been unable to offer someone health insurance coverage, regardless of the severity of their preexisting conditions. In fact, I once secured legitimate major medical health insurance for a woman who was dying of cancer in the hospital. How did I do it? Simple, I am an informed American. I know the laws that were already in place to protect consumers. Laws that were passed long before the president's health care 'reform' law was passed in 2010.

The truth is even if you have lost your employer sponsored group health insurance coverage and/or have exhausted a COBRA continuation plan you too can obtain guaranteed issue health insurance on an individual basis that will provide coverage for your preexisting conditions seamlessly from day one. Your options are as follows:

1.) If you have a Corporate tax i.d. number you can purchase a small group health insurance policy from most insurance carriers. With this scenario, a minimum of 2 people (often husband & wife) who work for the same corporation can apply for a small group health insurance policy. Those who are HIPAA qualified will receive coverage for their preexisting conditions immediately. Even those who are not HIPAA qualified will receive coverage for their preexisting conditions after a maximum period of 12 months. Be sure to read the outline of coverage for the Small Group plan you are applying for to make sure it provides coverage for your preexisting condition before you apply.

2.) Some States, like Colorado, provide what is known as a "Self Employed Group of One". In these States, you do not even need to have another person to comprise a "Group Health Insurance Plan". To find out how your state defines Small Group health insurance visit this site:  http://www.statehealthfacts.org/comparetable.jsp?cat=7&ind=350

3.) Enroll in your states High Risk Health Insurance Pool. 35 States provide them. CLICK HERE to see if your state does. In our home state of Illinois the risk pool is called the Illinois Comprehensive Health Insurance Plan (ICHIP). ICHIP is a state health benefits program and not an insurance company. Persons must qualify for coverage, but in most cases if the applicant is coming off an exhausted qualified COBRA continuation plan from a prior employer sponsored group, their preexisting conditions will be covered from day one (provided again that those conditions are a covered expense on the ICHIP policy). ICHIP (and all insurance risk pools) are by no means entitlement programs. They do indeed require you to pay a monthly premium. Nothing in this life is free. To find out if your State has a State Sponsored High Risk Pool visit http://www.naschip.org/states_pools.htm

2014 update Thanks to Obamacare, state High Risk Pool insured members are also losing their coverage all over the country and will be forced into the Obamacare exchanges where many of them will pay much more for coverage and be exposed to much more out of pocket. Most especially if they do not qualify for a subsidy.

4.) If you live in one of the 10 States that have an "Individual Market Guaranteed Issue Mandate" you are guaranteed Health Insurance coverage for preexisting conditions from a variety of Health Insurance carriers that operate within that state. For example, in the state of Ohio, there are 20 Health Insurance carriers that must by law "Guarantee Issue" 4% of their block of business to people with preexisting conditions during an annual 'Open Enrollment' period. During this annual period, each health insurance carrier must report to the Ohio Department of Insurance as to whether or not they have "met their 4% Guaranteed Issue quota". Once they have met their 4% quota, any future applicants with preexisting conditions are then referred to one of the other health insurers operating in Ohio who have not met their 4% quota and are then guaranteed coverage from that carrier. Did you know that Ohio has never maxed out the 4% quota for all carriers? Never. And, everyone has access to coverage for preexisting conditions in the state of Ohio.

2014 Update This concept is such a good idea that HHS - the Health & Human Services department - rewrote the Obamacare law regarding preexisting conditions in June of 2011 and  adopted this concept for 2014. Beginning in 2014 there will be two national "Open Enrollment" periods for all Americans to obtain guaranteed issue coverage regardless of preexisting conditions. Those two periods are from January 1st of 2014 to March 31st of 2014 and from October 15th - December 7th 2014. Outside of those two "Open Enrollment" periods you will not be able to obtain coverage for a preexisting conditions unless you qualify for 'Special Enrollment" period.

Whilst adopting Ohio's plan will help to inhibit 'Adverse Selection' and provide an impetus for consumers to maintain health insurance between "Open Enrollment" periods. Make no mistake. 'Adverse Selection' will still exist because the fine for not purchasing health insurance is far less expensive than actually purchasing health insurance. If this fine amount is not increased, 'Adverse Selection' will still continue. This coupled with 'Community Rating' - charging young people much more for health insurance will lead to what we in the industry call a "Death Spiral. And, since there is nothing in the PPACA that states health insurance must continue to offer products within the PPACA "Health Insurance Exchange Marketplace" 2015 could end up being a very bad year for the health insurance industry and most importantly for their policy holders.

5.) Even if you are totally disabled and no longer able to work because of a debilitating medical condition, you can apply for one of our country's MANY safety nets called SSDI (Social Security Disability Income) and with it early Medicare benefits. Learn more @ www.disabilitysecrets.com

In case you missed that information, let me reiterate. 45 States in our Union provide guaranteed insurability to individual health insurance applicants, regardless of preexisting conditions for decades before the 'Patient Protection and Affordable Care Act', a.k.a. "Obamacare". This is not what we were told by the president. 

In addition to the aforementioned existing legal options to pursue Guaranteed Issue Health Insurance for those with preexisting conditions. There are also over 1,200 "free" (subsidized by taxpayers and philanthropists) health clinics around the United States. Click "free" clinics in your State to find more information. If your situation is dire, Federal EMTALA law mandates that you must be treated without discrimination at your local emergency room.

If your child has a preexisting condition and you are at or below the Federal Poverty Level you are further entitled to the Federal SCHIP program, which is an extension of our Medicaid system. To find out if you qualify click here. If you do qualify be sure to see if your State has any money left. Some States like Arizona recently terminated their SCHIP program because the entitlement rendered them BANKRUPT

Many States like Illinois have already dramatically expanded their Medicaid programs to include Tax Payer funded health insurance for low income adults , women who are currently pregnant and women who have been diagnosed with Breast or Cervical cancer. All of these benefits are provided to those without health insurance. In fact, in the state of Illinois, our All Kids Covered plan quite literally provides "free" health insurance to ALL indigent kids including the 75% of recipients who are illegal aliens. Thanks to Obamacare Medicaid Expansion we are about to drive our Illinois Medicaid system into a fiscal death spiral by adding on and expected 800,000 new recipients and being forced as state taxpayers to cover half of the cost of the 'Woodwork" population. Those who were always eligible for Medicaid but never bothered to enroll. They will be forced to enroll via the Federal health insurance purchase mandate beginning on 1/1/14. On January 30, 2012, the Civic Federation released its “Budget Roadmap”. In it, they highlight the fact that Illinois state officials now believe that the Illinois Medicaid program will have between $21 and $23 billion in UNPAID bills by 2017.

The President's "Patient Protection and Affordable Care Act' will make that Medicaid debt exponentially worse. Not just in Illinois but around the country in states that choose to further expand Medicaid. Medicaid is the worst and most dangerous health care program ever devised by man. Without reform, I truly fear for the lives of the 17 million Americans that the CBO predicts will be auto enrolled onto this program beginning in 2014.

Back in 2010 I spoke the TRUTH about preexisting conditions at the 2010 Chicago Tax Day Tea Party rally:

Please Note: The vast majority of health insurance carriers that underwrite Individual Health Insurance plans DO INDEED provide coverage for many preexisting medical conditions (such as Hypertension, Hyperlipidimia, Gastric Reflux, Asthma, etc.) and have done so for many year. Providing of course that these conditions are well controlled by diet or medication AND you duly disclose these preexisting conditions on your health insurance application. This is important to know now because the president's temporary PCIP - 'Preexisting Condition Insurance Plan' already ran out of money and has ceased further enrollment as of March 5, 2013

What will health insurance cost in the new health insurance exchanges?

If you want to see just how expensive government approved health insurance will be in the new health insurance exchanges. Just click on the Kaiser Family Institute’s Exchange Calculator here. Then, enter an income of $50,000 for a family of four.  First, look at the “unsubsidized health insurance premium“. This is the actual  premium for the health insurance. As you can see, the cost of these policies are extremely expensive. Why?  Because the “Affordable Care Act” mandates that all of these Preventative Care benefits must be provided to the policy holder with no copay, deductible or any other out of pocket expense. Add to all of those newly mandated Preventative Care benefits, the recently added  “Essential Health Benefits” which will also now be included on all health insurance policies sold inside and outside of the health insurance exchanges.

Insurance exchange

As I have mentioned many times before, government imposed mandates on health insurance carriers are the primary driver behind high health insurance costs. Historical precedent proves this. In 1979 there were a total of 252 mandates forced upon the health insurance industry nationwide, by 2007 there were nearly 1900. Today, there are more than 2,262 mandates. The new “Affordable Care Act” mandates will drive up health insurance costs even higher.

Still using the calculator, take a look at how much the consumer will actually pay for their health insurance once the few, the proud, the 51% of us who still pay income taxes have subsidized their premium. The “Affordable Care Act” doubles down on what I call “Consumer Detachment Syndrome”. This ‘syndrome’ is a result of WW2 era legislation that tied health insurance to employers. Since many employers pay much of the cost of health insurance for their employees as an added benefit. Many consumers have no idea what health insurance truly costs until they lose their job and receive a COBRA continuation premium that rivals the size of their mortgage payment.

This “Detachment Syndrome” will continue with the “Affordable Care Act” since many consumers will not see these massive new tax payer subsidies when they purchase health insurance in the exchanges. Instead, they will believe that the “Affordable Care Act” magically reduced the cost of health insurance, just like the President promised. And, the burden on the tax payer will continue to increase. Sadly, there are not enough producers to tax to sustain this massive new entitlement for long. This means that the printing and borrowing will continue at the Federal level and the cost of all of this will be passed on to our children and grandchildren. Either way, the “Affordable Care Act” is unsustainable.

States like Massachusetts have already developed a state-based health insurance exchange. In fact, the exchange in Massachusetts is the prototype that will be used to develop other health insurance exchanges under the PPACA. There’s only one problem, the cost to taxpayers. At last count, the Massachusetts health care overhaul initiated by Mitt Romney has cost taxpayers more than $8 Billion. The Federal tax credits provided to other states who make the catastrophic budgetary mistake to develop a state-based PPACA exchange should be equally staggering.

Still have that calculator open? Enter $30,000 for a family of four and $15,000 for an individual. As you can see, those people will not be getting health insurance. In fact, according to the latest CBO assessment, 17 million of them will receive a government welfare program called Medicaid instead. Medicaid is the worst and most dangerous health care program ever devised by man. Even though President Obama promised “Affordable Health Insurance for all Americans.”

Will New York health insurance premiums really go down by 50% because of Obamacare?

The front page of today's New York times has an article written by Roni Caryn Rabin and Reed Abelson that states that premiums will "be at least 50% lower on average than those currently available in New York". To what do they contribute this massive drop in premiums? That's right, the miraculous premium reducing powers of Obamacare!

The authors quote Joanne Peters, a spokeswoman for the Department of Health and Human Services as saying “We’re seeing in New York what we’ve seen in other states like California and Oregon — that competition and transparency in the marketplaces are leading to affordable and new choices for families.” Even Forbes magazine's Rick Ungar now knows that premiums are not really going to drop in California because of Obamacare. Most especially after his counterpart at Forbes Avik Roy accurately blew up that fallacy in his fact based response to Rick's article entitled "Unexpected Health Insurance Rate Shock in California".

In the one hour debate I had with Mr. Ungar I stated that his entire article was based on a lie that was promulgated by Peter Lee, the Executive Director of "Covered California". You can read my response to Mr. Ungar and download our one hour debate here. Courtesy of the David Webb show on Sirius XM Patriot Satellite Radio.

Yet the political Left continues to print hyperbole in the hopes that policy wonks who operate on facts won't pick their pieces apart like vultures picking at the rotten, festering corpse that is Obamacare. Well, let me be the first 'wonk' to expose this latest fallacy.

The truth is New York, and 7 other states have already had the worst parts of Obamacare for many years. Namely, Community Rating and Guaranteed Issue. Both of these failed Liberal health care policies have resulted in driving premiums to their highest point in recorded history in those states. These policies have also driven insurance carriers out of those states by the droves. Why? Because, those states did not have a mandate to purchase health insurance. As such, many consumers chose to opt out and go uninsured instead. Meaning that there were less people insured in those states, so there were less lives to spread risk around. This drove premiums even higher. Even Mr. Ungar admitted this during our debate back in May.

This means that the premium assumptions made in the New York Times piece are based on the false premise that 'young invincibles' and other New York consumers will buy Obamacare compliant health insurance instead of opting out and paying the much smaller fine for not doing so. This simply will not happen to the degree that Obamacare supporters want it to. Regardless of how many NFL players that HHS attempts to recruit to 'sell Obamacare' to our youth. Why? Because the fine for not buying health insurance is only 1% of one's MAGI - Modified Adjusted Gross Income - in 2014. And, we are not repealing EMTALA - the federal law that requires hospitals to treat any patient within 250 yards of an emergency room - regardless of their ability to pay. Also, consumers will be able to buy Guaranteed Issue health insurance coverage, regardless of the severity of their preexisting conditions during the new annual Obamacare 'Open Enrollment' periods, with no proof of prior coverage. It is these perverse incentives that will actually incentivize consumers not to purchase health insurance. As was the case in all 8 states that have adopted the same failed policies before.

Lastly, let me address another statement made in today's New York Times piece. Namely this one: "Beginning in October, individuals in New York City who now pay $1,000 a month or more for coverage will be able to shop for health insurance for as little as $308 monthly."

The truth is New York residents can shop today using this private health insurance exchange that I have had on this brokerage site for many years before Obamacare to find quality health insurance coverage for a lot less than "$1,000 a month or more". For example a 45 year old male, non-smoker living in Monroe county, New York would pay $321.21 a month today for a policy with a $1,250 deductible and out of pocket expenses commensurate with the plans that will be offered in the exchanges in 2014. So, in conclusion, can someone please tell me why do we need Obamacare again?

Did the IRS write new law without consent of congress to expand their Obamacare power?

Since the current Republican leadership does not have the political will to defund Obamacare and have funded it willingly in every CR - Continuing Resolution - since early 2011. Where we should be concentrating our efforts is on making sure that there is no money appropriated for federally-facilitated HIX - Health Insurance Exchanges. As it stands now, 27 states have rejected state-based health insurance exchanges. When a state rejects a state-based exchange, the PPACA legislation allows HHS to usurp our 10th amendment rights and establish a federally-facilitated exchange in that state whether the state legislature wants it or not. Section 1311 of the PPACA outlines the powers granted to the IRS to provide APTC - Advance Premium Tax Credits - that will be used to artificially lower the massive cost of health insurance in the exchanges. Tied to those APTC's is also the power allotted to the IRS to penalize employers in that state (with 50 or more full-time employees) $2,000 or $3,000 per employee (first 30 employees waived). This is a LOT of new power granted to the IRS and this is the reason the IRS is hiring thousands of new agents.

However, section 1321 describes federally-facilitated exchanges that will be established in all 27 states that have rejected a state-based exchange. In these exchanges, the IRS is granted no such authority. In these federally-facilitated exchanges, the IRS has no power to provide APTC's OR to penalize ANY employer in that state. Now, since the crafters of the PPACA assumed that every state would willingly establish a state-based exchange, there was NO money appropriated for federally-facilitated exchanges. And, here's the kicker, in late 2011 the IRS simply wrote new law to empower themselves to be able to offer APTC's and penalize employers in all 27 states that have wisely rejected a state-based exchange. Not only is this illegal since the IRS is not a Legislative branch but President Obama is planning on following that new law that was written by the IRS. Watch Michael Cannon of CATO discuss this issue below:



This illegal action and President Obama's support of it has prompted the
Oklahoma Attorney General E. Scott Pruitt to amend his lawsuit to include a section that sues the IRS for illegally writing new law and granting itself power that it was not granted in the PPACA as originally written. There have been zero funds appropriated for these federally-facilitated exchanges. And, it is up to us to sound the clarion horn to make sure every American knows this illegal action was taken by the IRS and to make sure that no debt ceiling deal, no CR and no bill is allowed to pass that provides funding for these federally- facilitated exchanges. Read more about Mr. Pruitt's lawsuit here.

What is the Impact of the PPACA ‘Roberts Tax’ on Individuals, Taxpayers and Business Owners?

Beginning January 1, 2014 the PPACA (a.k.a. ‘Obamacare’) legislation levies a brand new tax – the “Roberts Tax”. A tax aptly named after U.S. Supreme Court Chief Justice John Roberts who created this new tax all by himself. It is neither an excise tax, nor a capital gains tax or any other kind of defined tax. It is instead a new tax, a tax for doing nothing and it will be levied on nearly all Americans including small and large business owners whether they do offer health insurance to their employees or they do not. To find out if you will pay the ‘Roberts Tax’ see chart below:

The best way to describe this new tax is to imagine walking into a grocery store and the clerk asks if you would like to purchase a pack of gum. You politely decline the offer and are then forced by a new tax law – as defined by John Roberts – to give that clerk a tax for refusing to purchase that pack of gum. This, my fellow Americans, is how unmoored from our Constitution that our Federal Government has become.

It is important to note that this new ‘Roberts Tax’ is a tax that was vehemently denied by President Obama on multiple occasions as being a tax at all. In the interview below with ABC news, President Obama passionately refutes the very definition of a tax, as defined in the dictionary, in order to continue to message this new tax as a ‘fine’ and not a tax.

The reason President Obama so passionately refuted the fact that this new ‘Roberts Tax’ is indeed a tax and instead messaged it as a ‘fine’ is because he made a ‘firm pledge’ (in the video below) to the American people in Dover, New Hampshire, prior to the passage of the PPACA. “I can make a firm pledge. Under my plan, no family, making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.” – Barack Obama.

Beginning January 1, 2014, this new ‘Roberts Tax’ will affect nearly all Americans. None more onerously than small business owners with 50 or more full-time employees who do not offer health insurance to their employees. Or, do not offer a health insurance plan that includes the new PPACA mandated Essential Health Benefits Package“.

Obamacare Employer Mandate

These small business owners are referred to by the Obama administration as ‘Large Employers’. The Obama administration considers a ‘Large Employer’ as one with more than 50 full-time employees in calendar year 2013. Thanks to a ‘new rule’ written by HHS, a full-time employee has now been REDEFINED as one who works 30 hours or more each week (traditionally ‘full time’ employee has been one who works 40 hours per week). Full-time seasonal employees who work for less than 120 days during the calendar year are excluded from any PPACA ‘Robert’s Tax’ calculations. However, the hours worked by part-time employees are included in the calculation of a ‘Large Employer’, each month, by dividing their total number of monthly hours worked by 120.

EXAMPLE:

A ‘Large Employer’ has 35 full-time employees (who work 30 or more hours per week). That ‘Large Employer’ also has 20 part time employees who each work 24 hours per week. This equates to 96 hours each month. These part-time employee hours would be equal to 16 full-time employees. Here’s how that is calculated:

20 employees multiplied by 96 hours = 1920 total hours worked.  1920 hours  divided by 120 = 16 full time employees. Isn’t this fun? Oh wait, there’s more!

Employer Penalty Flowchart

How the new ‘Robert’s Tax’ a.k.a. “Shared Responsibility Clause” is triggered for “Large Employers”

Beginning in 2014, many employees who are not offered health insurance through their employer and who are not eligible for Medicaid may be eligible for “Advanced Premium Tax Credits” for coverage through a PPACA “Health Insurance Exchange”.
The PPACA empowers the Internal Revenue Service to allot ‘Advance Premium Tax Credits’ to childless adult individuals with incomes surpassing 138% of the Federal Poverty Level and families 400% of the
Federal Poverty Level. Using 2012 FPL, this would mean that individuals in 48 contiguous states & D.C. making $42,680 annually and families making $92,200 would now qualify for an ‘Advance Premium Tax Credit’ in state-based PPACA “Health Insurance Exchanges”.

The IRS has released additional ‘guidance’ related to the PPACA “Employer Shared Responsibility” rules.  The guidance includes proposed regulations published in the Federal Register on Wed. January 2nd, 2013 and a series of questions and answers published on the IRS website.  For the most part the new guidance closely follows previous guidance released by the IRS.  However, there are a number of clarifications and some important new information for employers to consider.

Background                               

Beginning in 2014, an “applicable large employer” may be subject to a “Shared Responsibility Payment” (i.e. Robert’s Tax) under one of two different circumstances:

  1. 4980H(a) liability – Applies if an employer fails to offer to its full-time employees (and their dependents) the opportunity to enroll in minimum essential coverage (MEC), and any full-time employee is certified as having received a subsidy (i.e. a premium tax credit or cost sharing reduction) when purchasing individual health insurance through a public Exchange.  In this case the employer may be liable for a penalty of $2000 per year times the total number of full-time employees (not counting the first 30).
     

  2. 4980H(b) liability – Applies if the employer does offer its full-time employees (and their dependents) MEC, but the plan is unaffordable or does not provide minimum value, and at least one full-time employee is certified as having received a subsidy when purchasing individual health insurance through a public Exchange.  In this case the employer may be liable for a penalty of $3000 per year times the number of full-time employees who are certified to receive, and purchase, subsidized individual health insurance through a public Exchange

An applicable large employer is an employer that employed an average of at least 50 full-time employees during the preceding calendar year.  See below for additional details on how related organizations and corporations under common control will be treated for the purpose of this rule.

Transition Rule

The IRS guidance provides transition ‘relief’ for non-calendar year plans.  Employers who sponsor non-calendar year plans will not be liable for any 4980(H) liability until the first plan year beginning after January 1, 2014.

To be eligible for this transition ‘relief’, an employer must have maintained the non-calendar year plan as of December 27, 2012 (the day prior to the initial release of the rule).  This provision eliminates the opportunity for an employer to change plan years in an attempt to delay being subject to 4980(H) liability.

Offering Coverage to all Full-time Employees – The 95% Rule

As stated above, an employer faces potential penalties under 4980H(a) if it fails to offer minimum essential coverage to all full-time employees.  The IRS has previously commented that the penalty should not apply in the case of an employer that intends to offer coverage to all its full-time employees, but fails to offer coverage to a few full-time employees.  IRS Notice 2011–36 initially addressed this issue by indicating that the IRS was contemplating a rule stating that an employer offering coverage to “substantially all” of its full-time employees would not be subject to a 4980H(a) assessable payment. In the new guidance the IRS allows a margin of error regarding this requirement, and has introduced a “95%” standard.

An applicable large employer will be treated as offering coverage to its full-time employees if it offers coverage to all but 5% (or if greater, five) of its full-time employees.  This rule alleviates employer fears that a small administrative mistake could trigger significant employer penalties.

Entities under Common Control

All entities and organizations treated as a single employer under the rules contained in Code §414 are combined in determining if an employer is an “applicable large employer.”  Consequently, a number of smaller organizations (that may not each have 50 FTEs) could be subject to 4980(H) liability if they are considered under common control according to §414 rules.

The new IRS guidance defines each company that is part of a control group as an “applicable large employer member” and applies special rules to each separate member of the control group:

  • Penalties will apply separately to each member organization of a control group.  For example, if one member organization fails to provide MEC to all its full-time employees, the  penalty would be based on the number of full-time employees in that particular organization, not the total number of employees in the entire control group.

  • In calculating the 4980H(a) liability, the “not counting the first 30 rule” would apply proportionality to each member entity.  For example, a member entity that accounts for 50% of the total full-time employees in the control group would pay a penalty of $2000 per year times the number of full-time employees in that specific entity not counting the first 15 (50% of 30).

Dependent Coverage

To avoid 4980(H) liability, employers must offer coverage to all full-time employees and their dependents.  It is important to note that the cost of the dependent coverage is not used in determining the plan’s affordability under 4980(H).  Plan affordability for employer penalty purposes is based only on the amount the employee must pay for self-only coverage.

In what was a surprise to many observers, the requirement to offer coverage to dependents does not apply to spouses.  The proposed regulations define an employee’s dependents for purposes of 4980(H) as an employee’s child who is under 26 years of age.

Affordable Coverage Safe Harbors

Employers face potential liability under 4980(H)(b) if the employer coverage is not affordable to an employee.

  • Coverage is affordable if the employee’s required contribution for self-only coverage does not exceed 9.5% of the employee’s household income.

  • Household income is defined as the modified adjusted gross income of the employee and any members of the employee’s family (including a spouse and tax dependents) who are required to file an income tax return

Recognizing that employers will generally not know an employee’s household income, the IRS outlined a proposed affordability safe harbor (referred to as the W–2 safe harbor) in prior notices.  The proposed regulations provide two additional safe harbors for determining affordability.

  1. W-2 Safe Harbor – An employer will not be subject to an assessable payment if the required employee contribution toward the self-only premium for the employer’s lowest cost coverage that provides minimum value, does not exceed 9.5 % of the employee’s W–2 wages.

  2. Rate of Pay Safe Harbor – An employer can take the hourly rate of pay for each hourly employee and multiply that rate by 130 hours per month to determine a monthly “rate of pay.”  The employee’s monthly contribution amount (for the self-only premium of the employer’s lowest cost coverage that provides minimum value) is affordable if it is equal to or lower than 9.5% of the computed monthly wage estimate.  For salaried employees, monthly salary would be used instead of hourly salary multiplied by 130.

  3. Federal Poverty Line Safe Harbor – An employer may also rely on a design-based safe harbor using the Federal Poverty Level (FPL) for a single individual.  Coverage offered to an employee is affordable if the employee’s cost for self-only coverage does not exceed 9.5% of the FPL for a single individual.  For example, in 2012 affordable coverage under this method would have been set at a monthly contribution in the lower 48 states of $88.43 for self-only coverage (FPL is slightly higher in Alaska and Hawaii)

Election Changes under Section 125 Cafeteria Plans

Employees enrolled in a non-calendar year Section 125 Cafeteria plan who are eligible on January 1, 2014 for subsidized coverage when purchasing health insurance through a public Exchange may wish to drop the employer plan during the plan year.  However, current Section 125 rules would not permit a mid-plan-year election change in this situation.

The proposed regulations allow an employer to amend their Section 125 plan to permit this change.  Interestingly, the rules do not require the employer to allow this election change.  Some employers may be inclined not to permit such a change if an employee moving to subsidized individual coverage triggers employer liability under the shared responsibility rules.

Additional Guidance on Definition of Full-Time Employees

In August 2012 the IRS released significant guidance on defining an employee’s full-time status, including an optional look back measurement period and corresponding stability/eligibility period.  The new proposed regulations clarify and expand on a number of issues related to these full-time employee rules.

  • The guidance clarifies that that an employer can use the standard look back measurement period each year to determine the full-time status of all ongoing employees.  However, for new employees, an initial measurement period can be applied only to “variable hour” and seasonal employees.  A plan may not have a waiting period of more than 90 days for all other employees expected to work 30 hours or more per week.

  • When determining eligibility for 2014, an employer who plans to use a 12-month measurement and stability period is allowed to use a shorter measurement period in 2013, which will apply to the 2014 stability period.  However the 2013 one-time “short” measurement period must be at least 6 months long and begin no later than July 1, 2013.

  • An employee hired to work an average of at least 30 hours per week cannot be treated as a variable hour employee simply because they are hired into a high turnover position.  These employees must be treated as full-time employees and can have no more than a 90-day waiting period before being eligible for coverage.

  • The guidance clarifies how hours of service must be counted toward an employee’s full-time status, including a requirement to count all paid leave as hours of service

Summary

These new ‘Interim Final Rules’ contain other miscellaneous guidance, including rules of special interest to staffing firms.  One such set of “anti-abuse” rules is designed to limit an employer’s ability to use temporary staffing arrangements to avoid 4980(H) liability.

UPDATE: Even though Barack Obama has now delayed this onerous mandate on employers until 2015 the ramifications have already been realized in the latest jobs report with a massive increase in part time workers.

Extra Large Employers

Finally, ‘Extra Large Employers’ that offer health insurance to more than 200 full-time employees must automatically enroll new full-time employees in a plan (and continue covering current employees). Many of these ‘Extra Large Employers’ offer ‘self funded plans’ with ‘stop loss arrangements’ and defined ‘attachment points’. For now, these employers are in luck for they are EXEMPT from many of the more onerous regulations imposed by the PPACA. For an excellent break down of the regulations these employers are required to comply with visit this link.  It is this expert’s opinion that among the reported 13,000 pages of additional regulations that have been written since the passage of the PPACA. There will most likely be regulations that change the exemptions that employers who offer ‘self funded’ plans currently enjoy. As insurance companies begin to offer newly designed ‘stop loss’ arrangements with smaller ‘attachment points’ to attract smaller employers. In fact,  there is already a ‘PPACA panel’ exploring this as I write this article
 


Click here to watch a special report the PPACA’s impact on business.

You can not get around the “Roberts Tax”

Let’s say you’ve read the above information and your brilliant mind starts devising an easy way out. For example, you decide it would be prudent to split up your company of 50 employees into 2 separate companies with 25 employees each. Great idea! The only problem is the Statist attorneys who helped craft the PPACA already thought of that.

The IRS will still consider both of your companies as one company. That’s because the ‘Robert’s Tax’ relies on  “controlled group” provisions. These provisions focus on who controls the company. If you are the named owner of those 2 companies, the IRS will combine all employees under both corporations and hit you with the ‘Robert’s Tax’.

“Controlled group” provisions are meant to prevent skirting around the law” said Christopher Condeluci, a Washington D.C. attorney at the law firm Venable who helped draft the rule for the Senate Finance Committee. “These rules are intended to snuff out this type of abuse,” Condeluci said. “You cannot get around the employer mandate.”

Let’s say your a business owner who employs 50 or more employees at completely different companies. You have 25 employees at a car repair shop and 25 at a restaurant. You would have to provide insurance or pay the “Roberts Tax” at both, even though each or your separate company has less than 50 employees. Again, it’s the named owner of those combined companies that the IRS looks at under ‘controlled group’ provisions.

Worse yet, Married couples may also find themselves impacted by ‘controlled group’ provisions, since IRS law generally assumes an individual owns interest in their spouse’s business. Oh, it’ just keeps getting better doesn’t it?

Get ready for more paperwork and new regulation compliance.
 

Beginning March 1, 2013, employers must provide employees written notice of the following:

  • Of the existence of a PPACA  “Health Insurance Exchange’

  • Of their potential eligibility for federal assistance if the employer’s plan is “unaffordable”

  • And that they may lose the employer’s contribution to health coverage if they purchase health insurance through a PPACA ‘Health Insurance Exchange’.

Besides the 20 new or higher taxes imposed by the PPACA which are listed at the end of this article. The non-partisan Government Accountability Office (GAO) compiled a list of 47 new regulations the IRS is empowered to administer in overseeing the PPACA.

1.) Prohibits group health plans from discriminating in favor of highly compensated individuals.

2.) Establishes a temporary reinsurance program to provide reimbursement for a portion of the cost of providing health insurance coverage to early retirees.

3.) Imposes a penalty on health plans identified in an annual Department of Health and Human Services (HHS) penalty fee report, which is to be collected by the Financial Management Service after notice by the Department of the Treasury (Treasury).

4.) Requires state exchanges to send to Treasury a list of the individuals exempt from having minimum essential coverage, those eligible for the premium assistance tax credit, and those who notified the exchange of change in employer or who ceased coverage of a qualified health plan.

5.) Provides tax exemption for nonprofit health insurance companies receiving federal start-up grants or loans to provide insurance to individuals and small groups.

6.) Provides tax exemption for entities providing reinsurance for individual policies during first 3 years of state exchanges.

7.) Provides premium assistance refundable tax credits for applicable taxpayers who purchase insurance through a state exchange, paid directly to the insurance plans monthly or to individuals who pay out-of-pocket at the end of the taxable year.

8.) Provides a cost-sharing subsidy for applicable taxpayers to reduce annual out-of-pocket deductibles.

9.) Outlines the procedures for determining eligibility for exchange participation, premium tax credits and reduced cost-sharing, and individual responsibility exemptions.

10.) Allows advance determinations and payment of premium tax credits and cost-sharing reductions.

11.) Authorizes IRS to disclose certain taxpayer information to HHS for purposes of determining eligibility for premium tax credit, cost-sharing subsidy, or state programs including Medicaid, including (a) taxpayer identity; (b) the filing status of such taxpayer; (c) the modified adjusted gross income of taxpayer, spouse, or dependents; and (d) tax year of information.

12.) Provides nonrefundable tax credits for qualified small employers (no more than 25 full-time equivalents (FTE) with annual wages averaging no more than $50,000) for contributions made on behalf of its employees for premiums for qualified health plans.

13.) Requires all U.S. citizens and legal residents and their dependents to maintain minimum essential insurance coverage unless exempted starting in 2014 and imposes a fine on those failing to maintain such coverage.

14.) Requires every person who provides minimum essential coverage to file an information return with the insured individuals and with IRS.

15.) Imposes a penalty on large employers (50+ FTEs) who (1) do not offer coverage for all of their full-time employees, offer unaffordable minimum essential coverage, or offer plans with high out-of-pocket costs and (2) have at least one full-time employee certified as having purchased health insurance through a state exchange and was eligible for a tax credit or subsidy.

16.) Requires information reporting of health insurance coverage information by large employers (subject to IRC 4980H) and certain other employers.

17.) Offers tax exclusion for reimbursement of premiums for small-group exchange participating health plans offered by small employers to all full-time employees as part of a cafeteria plan.

18.) Subjects new group health plans to certain Public Health Service Act requirements and imposes the excise tax on plans that fail to meet those requirements. (Conforming amendment)

19.) Authorizes IRS to disclose certain taxpayer information to the Social Security Administration (SSA) regarding reduction in the subsidy for Medicare Part D for high-income beneficiaries. (Conforming amendment)

20.) Requires the independent institute partnering with the National Academy of Sciences (NAS) to implement a key national indicator system to be a nonprofit entity under section 501(c)(3).

21.) Imposes a fee through 2019 on specified health insurance policies and applicable self-insured health plans to fund the Patient-Centered Outcomes Research Trust Fund to be used for comparative effectiveness research.

22.) Imposes a 40 percent excise tax on high cost employer-sponsored health insurance coverage on the aggregate value of certain benefits that exceeds the threshold amount.

23.) Requires employers to disclose the value of the employee’s health insurance coverage sponsored by the employer on the annual Form W-2.

24.) Repeals the tax exclusion for over-the-counter medicines under a Health Flexible Spending Arrangement (FSA), Health Reimbursement Arrangement (HRA), Health Savings Account (HSA), or Archer Medical Savings Account (MSA), unless the medicine is prescribed by a physician.

25.) Increases tax on distributions from HSAs and Archer MSAs not used for medical expenses.

26.) Limits health FSAs under cafeteria plans to a maximum of $2,500 adjusted for inflation.

27.) Imposes additional reporting requirements for charitable hospitals to qualify as tax-exempt under IRC 501(c)(3) and requires hospitals to conduct a community health needs assessment at least once every 3 years and to adopt a financial assistance policy and policy relating to emergency medical care.

28.) Imposes a fee on each covered entity engaged in the business of manufacturing or importing branded prescription drugs.

29.) Imposes an annual fee on any entity that provides health insurance for any U.S. health risk with net premiums written during the calendar year that exceed $25 million.

30.) Allows the deduction for retiree prescription drug expenses only after the deduction amount is reduced by the amount of the excludable subsidy payments received.

31.) Increases the threshold for the itemized deduction for unreimbursed medical expenses from 7.5 percent of Adjusted Gross Income (AGI) to 10 percent of AGA (unless taxpayer turns 65 during 2013-2016 and then threshold remains at 7.5 percent).

32.) Denies the business expenses deductions for wage payments made to individuals for services performed for certain health insurance providers if the payment exceeds $500,000.

33.) Imposes an additional Hospital Insurance (Medicare) Tax of 0.9 percent on wages over $200,000 for individuals and over $250,000 for couples filing jointly.

34.) Limits eligibility for deductions under section 833 (treatment of Blue Cross and Blue Shield) unless the organizations meet a medical loss ratio standard of at least 85 percent for the taxable year.

35.) Allows an exclusion from gross income for the value of specified Indian tribe health care benefits.

36.) Allows small businesses to offer simple cafeteria plans—plans that increase employees’ health benefit options without the nondiscrimination requirements of regular cafeteria plans.

37.) Establishes a 50 percent nonrefundable investment tax credit for qualified therapeutic discovery projects.

38.) Requires employers to provide free choice vouchers to certain employees who contribute over 8 percent but less than 9.8 percent of their household income to the employer’s insurance plan to be used by employees to purchase health insurance though the exchange.

39.) Imposes a tax on any indoor tanning service equal to 10 percent of amount paid for service.

40.) Excludes from gross income amounts received by a taxpayer under any state loan repayment or loan forgiveness program that is intended to provide for the increased availability of health care services in underserved or health professional shortage areas.

41.) Increases the maximum adoption tax credit and the maximum exclusion for employer-provided adoption assistance for 2010 and 2011 to $13,170 per eligible child.

42.) Extends the exclusion from gross income for reimbursements for medical expenses under an employer-provided accident or health plan to employees’ children under 27 years.

43.) Imposes an unearned income Medicare contribution tax of 3.8 percent on individuals, estates, and trusts on the lesser of net investment income or the excess of modified adjusted gross income (AGI + foreign earned income) over a threshold of $200,000 (individual) or $250,000 (joint).

44.) Imposes a tax of 2.3 percent on the sale price of any taxable medical device on the manufacturer, producer, or importer

45.) Amends the cellulosic biofuel producer credit (nonrefundable tax credit of about $1.01 for each gallon of qualified fuel production of the producer) to exclude fuels with significant water, sediment, or ash content (such as black liquor).

46.) Clarifies and enhances the applications of the economic substance doctrine and imposes penalties for underpayments attributable to transactions lacking economic substance.

47.) Increases the required payment of corporate estimated tax due in the third quarter of 2014 by 15.75 percent for corporations with more than $1 billion in assets, and reduces the next payment due by the same amount.

What about that Small Employer Health Insurance Tax Credit?

The tax credit is available from 2010 through 2015. For 2010 – 2013 the maximum credit is 35% of qualified premium costs paid by for-profit companies, and 25% for non-profits. The maximum credit is only available to employers with no more than 10 full-time equivalent employees (FTE’s), who are paid average annual wages of $25,000 or less. A reduced credit is available on a phase-out basis for employers with between 10 and 25 FTE’s, who are paid average wages of $25,000 to $50,000. In effect, the credit is reduced by 6.667% for each FTE in excess of 10, and by 4% for each $1,000 in average annual wages paid above $25,000. For example, an employer with 13 full-time equivalent employees who are paid average annual wages of $45,000 will not receive a tax credit. No tax credit is available for employers with 25 or more FTE’s, or who pay average annual wages of $50,000 or more.

In 2014 through 2015, the credit increases to 50% of the amount of qualified premium costs paid by for-profits, and 35% for non-profits, however by then, the employer must participate in a state insurance exchange in order to obtain the credit. [Note: Each state is required to create an insurance exchange by January 1, 2014 which must include an American Health Benefit Exchange, as well as a Small Business Health Options Program (SHOP) Exchange.]

Have you noticed a common theme regarding the above new PPACA ‘Roberts Tax’ rules and regulations? That’s right, the fine for both the individual and for the employers is a fraction of the cost to purchase and maintain health insurance. This is not only why many employers will have a strong impetus to push their employees off of their health insurance plans but it is also why individuals will gladly pay the ‘Roberts Tax’ of $95 in 2014 (which graduates to $695 by 2016) instead of paying for a far more expensive health insurance plan. Worse yet, since the criminal fines (imprisonment) were removed from the PPACA legislation prior to passage. The only recourse that the Federal Government has to collect the ‘Roberts Tax’ is to hold one’s tax refund. Since nearly half of our nation pays no income taxes, how exactly will the IRS hold a tax refund from someone who pays no income taxes?! So, once again, who’s really going to be paying for all of this? That’s right! The few, the proud, the 53% of us who already pay all of the income taxes.

I discussed the impact of the “Roberts Tax” and other issue pertaining to the impact of the PPACA on Small Business owners for the Fox News Business television network on March 28, 2012:

Now that we’ve discussed the impact of the “Roberts Tax” on Individuals, Taxpayers and Business Owners. Let’s take a closer look at all of the 20 new or higher taxes levied upon taxpayers via the PPACA. Arranged by their respective effective dates, below is the total list of all $569 billion in tax hikes (over the next ten years) in the PPACA, where to find them in the bill, and how much your taxes were scheduled to go up based on initial projections by the CBO – Congressional Budget Office in the year 2010.

Taxes that took effect in 2010:

1. Excise Tax on Charitable Hospitals (Min$/immediate): $50,000 per hospital if they fail to meet new “community health assessment needs,” “financial assistance,” and “billing and collection” rules set by HHS. Bill: PPACA; Page: 1,961-1,971

2. Codification of the “economic substance doctrine” (Tax hike of $4.5 billion).  This provision allows the IRS to disallow completely-legal tax deductions and other legal tax-minimizing plans just because the IRS deems that the action lacks “substance” and is merely intended to reduce taxes owed. Bill: Reconciliation Act; Page: 108-113

3. “Black liquor” tax hike (Tax hike of $23.6 billion).  This is a tax increase on a type of bio-fuel. Bill: Reconciliation Act; Page: 105

4. Tax on Innovator Drug Companies ($22.2 bil/Jan 2010): $2.3 billion annual tax on the industry imposed relative to share of sales made that year. Bill: PPACA; Page: 1,971-1,980

5. Blue Cross/Blue Shield Tax Hike ($0.4 bil/Jan 2010): The special tax deduction in current law for Blue Cross/Blue Shield companies would only be allowed if 85 percent or more of premium revenues are spent on clinical services. Bill: PPACA; Page: 2,004

6. Tax on Indoor Tanning Services ($2.7 billion/July 1, 2010): New 10 percent excise tax on Americans using indoor tanning salons. Bill: PPACA; Page: 2,397-2,399

Taxes that took effect in 2011:

7. Medicine Cabinet Tax ($5 bil/Jan 2011): Americans no longer able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin). Bill: PPACA; Page: 1,957-1,959

8. HSA Withdrawal Tax Hike ($1.4 bil/Jan 2011): Increases additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent. Bill: PPACA; Page: 1,959

Tax that took effect in 2012:

9. Employer Reporting of Insurance on W-2 (Min$/Jan 2012): Preamble to taxing health benefits on individual tax returns. Bill: PPACA; Page: 1,957

Taxes that take effect in 2013:

10. Surtax on Investment Income ($123 billion/Jan. 2013):  Creation of a new, 3.8 percent surtax on investment income earned in households making at least $250,000 ($200,000 single).  This would result in the following top tax rates on investment income: Bill: Reconciliation Act; Page: 87-93

 

Capital Gains

Dividends

Other*

2012

15%

15%

35%

2013+

23.8%

43.4%

43.4%

*Other unearned income includes (for surtax purposes) gross income from interest, annuities, royalties, net rents, and passive income in partnerships and Subchapter-S corporations.  It does not include municipal bond interest or life insurance proceeds, since those do not add to gross income.  It does not include active trade or business income, fair market value sales of ownership in pass-through entities, or distributions from retirement plans.  The 3.8% surtax does not apply to non-resident aliens.

11. Hike in Medicare Payroll Tax ($86.8 bil/Jan 2013): Current law and changes:

 

First $200,000
($250,000 Married)
Employer/Employee

All Remaining Wages
Employer/Employee

Current Law

1.45%/1.45%
2.9% self-employed

1.45%/1.45%
2.9% self-employed

Obamacare Tax Hike

1.45%/1.45%
2.9% self-employed

1.45%/2.35%
3.8% self-employed

Bill: PPACA, Reconciliation Act; Page: 2000-2003; 87-93

12. Tax on Medical Device Manufacturers ($20 bil/Jan 2013): Medical device manufacturers employ 360,000 people in 6000 plants across the country. This law imposes a new 2.3% excise tax.  Exempts items retailing for <$100. Bill: PPACA; Page: 1,980-1,986

13. High Medical Bills Tax ($15.2 bil/Jan 2013): Currently, those facing high medical expenses are allowed a deduction for medical expenses to the extent that those expenses exceed 7.5 percent of adjusted gross income (AGI).  The new provision imposes a threshold of 10 percent of AGI. Waived for 65+ taxpayers in 2013-2016 only. Bill: PPACA; Page: 1,994-1,995

14. Flexible Spending Account Cap – aka “Special Needs Kids Tax” ($13 bil/Jan 2013): Imposes cap on FSAs of $2500 (now unlimited).  Indexed to inflation after 2013. There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children.  There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education.  Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs educationBill: PPACA; Page: 2,388-2,389

15. Elimination of tax deduction for employer-provided retirement Rx drug coverage in coordination with Medicare Part D ($4.5 bil/Jan 2013) Bill: PPACA; Page: 1,994

16. $500,000 Annual Executive Compensation Limit for Health Insurance Executives ($0.6 bil/Jan 2013). Bill: PPACA; Page: 1,995-2,000

Taxes that take effect in 2014:

17. Individual Mandate Excise Tax (Jan 2014): Starting in 2014, anyone not buying “qualifying” health insurance must pay an income surtax according to the higher of the following

 

1 Adult

2 Adults

3+ Adults

2014

1% AGI/$95

1% AGI/$190

1% AGI/$285

2015

2% AGI/$325

2% AGI/$650

2% AGI/$975

2016 +

2.5% AGI/$695

2.5% AGI/$1390

2.5% AGI/$2085

Exemptions for religious objectors, undocumented immigrants, prisoners, those earning less than the poverty line, members of Indian tribes, and hardship cases (determined by HHS). Bill: PPACA; Page: 317-337

18. Employer Mandate Tax (Jan 2014):  If an employer does not offer health coverage, and at least one employee qualifies for a health tax credit, the employer must pay an additional non-deductible tax of $2000 for all full-time employees.  Applies to all employers with 50 or more employees. If any employee actually receives coverage through the exchange, the penalty on the employer for that employee rises to $3000. If the employer requires a waiting period to enroll in coverage of 30-60 days, there is a $400 tax per employee ($600 if the period is 60 days or longer). Bill: PPACA; Page: 345-346

Combined score of individual and employer mandate tax penalty: $65 billion/10 years

19. Tax on Health Insurers ($60.1 bil/Jan 2014): Annual tax on the industry imposed relative to health insurance premiums collected that year.  Phases in gradually until 2018.  Fully-imposed on firms with $50 million in profits. Bill: PPACA; Page: 1,986-1,993

Taxes that take effect in 2018:

20. Excise Tax on Comprehensive Health Insurance Plans ($32 bil/Jan 2018): Starting in 2018, new 40 percent excise tax on “Cadillac” health insurance plans ($10,200 single/$27,500 family).  Higher threshold ($11,500 single/$29,450 family) for early retirees and high-risk professions.  CPI +1 percentage point indexed. Bill: PPACA; Page: 1,941-1,956

2012 updated CBO & JCT projections reflect a doubling of initial PPACA tax projections.

As is the case with nearly all Government data houses, initial projections are rarely on target. Now, less than 2 years after initial 2010 projections. The Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) confirm what America already knew – that the Democrats’ health care law is actually a $1.058 trillion tax hike that families and employers simply cannot afford.  The recent Supreme Court ruling left in place 21 tax increases enacted as part of that law, a dozen of which – marked with an asterisk (*) below – target Americans earning less than $200,000 per year for singles and $250,000 per year for married couples, in clear violation of the President’s pledge to avoid tax hikes on low- and middle-income taxpayers.  According to the new CBO and JCT estimates, the gross tax increases in the law now total $1.058 trillion over 2013-2022 That new amount is nearly twice the “advertised” ten-year tax hike amount claimed when Democrats originally pushed the law through Congress.

Provision

 March 2010 Estimate
(‘10-‘19)

 June/July 2012
Re-Estimates
(‘13-‘22)

Additional 0.9 percent payroll tax on wages and self-employment income and new 3.8 percent tax on dividends, capital gains, and other investment income for taxpayers earning over $200,000 (singles)/$250,000 (married)

 210.2

 317.7

“Cadillac tax” on high-cost plans *

 32.0

 111.0

Employer mandate *

 52.0

 106.0

Annual tax on health insurance providers *

 60.1

 101.7

Individual mandate *

 17.0

 55.0

Annual tax on drug manufacturers / importers *

 27.0

 34.2

2.3 percent excise tax on medical device manufacturers / importers *

 20.0

 29.1

Limit FSAs in cafeteria plans *

 13.0

 24.0

Raise 7.5 percent AGI floor on medical expense deduction to 10 percent *

 15.2

 18.7

Deny eligibility of “black liquor” for cellulosic biofuel producer credit

 23.6

 15.5

Codify economic substance doctrine

 4.5

 5.3

Increase penalty for nonqualified HSA distributions *

 1.4

 4.5

Impose limitations on the use of HSAs, FSAs, HRAs, and Archer MSAs to purchase over-the-counter medicines *

 5.0

 4.0

Impose fee on insured and self-insured health plans; patient-centered outcomes research trust fund *

 2.6

 3.8

Eliminate deduction for expenses allocable to Medicare Part D subsidy

 4.5

 3.1

Impose 10 percent tax on tanning services *

 2.7

 1.5

Limit deduction for compensation to officers, employees, directors, and service providers of certain health insurance providers

 0.6

 0.8

Modify section 833 treatment of certain health organizations

 0.4

 0.4

Other revenue effects

 60.3

 222.01

Additional requirements for section 501(c)(3) hospitals

Negligible

Negligible

Employer W-2 reporting of value of health benefits

 Negligible

 Negligible

1099 reporting for small businesses

 17.1

 Repealed by P.L. 112-9

 TOTAL GROSS TAX INCREASE
(BILLIONS OF DOLLARS)

 569.2

 1,058.3

Prepared by Ways and Means Committee Staff July 24, 2012

1 Includes CBO’s $216.0 billion estimate for “Associated Effects of Coverage Provisions on Tax Revenues” and $6.0 billion within CBO’s “Other Revenue Provisions” category that is not otherwise accounted for in the CBO or JCT estimates.

Dr. Jill Vecchio breaks down the impact of the PPACA on employers:

Does the PPACA really create a part-time work force?

Recently employees of Long Beach, California, Circle K convenient stores, the nation’s largest theater chain - Regal Entertainment Group, AAA Parking, the state of Virginia, the city of Dearborn, Michigan, selected Wendy’s restaurants, Taco Bell have been notified that their full-time work hours will be reduced to part-time hours. Specifically 29 hours or less. Why is this happening?

Under a clause of President Obama’s health care law called the “Shared Responsibility Penalty“. Employers with 50 or more full-time employees – are now incentivized to reduce full-time worker hours to part-time hours. For many years, a full-time employee was considered an employee who works 40 hours or more per week. Now, because of a ‘new regulation’ written by HHS, a ‘full-time employee’ has been redefined as one who works 30 hours or more per week.

Under the PPACA, any employer with 50 or more full-time employees who does not offer PPACA approved MEC – “Minimal Essential Coverage” must pay an annual, non tax deductible penalty of $2,000 to the IRS for each full-time employee. Starting with the 30th full-time employee on up.

How the PPACA “Shared Responsibility Penalty” is triggered by employers
 

Beginning in 2014, full-time employees who are not offered MEC – ‘Minimal Essential Coverage’ through their employer and who are not eligible for Medicaid may be eligible for “Advanced Premium Tax Credits”. These ‘Advanced Premium Tax Credits’ will be provided by the taxpayer to artificially lower the extremely expensive coverage that will be provided in the new “Health Insurance Exchanges”.

The PPACA empowers the Internal Revenue Service to provide these ‘Advance Premium Tax Credits’ to childless adult individuals with incomes surpassing 138% and families making up to 400% of the FPL – Federal Poverty Level. Using 2012 FPL, this would mean that individuals making $42,680 annually and families making $92,200 would now qualify for an ‘Advance Premium Tax Credit’ in the new “Health Insurance Exchanges”.

On Wednesday, January 2, 2013 the IRS released proposed new regulations related to the PPACA “Employer Shared Responsibility” rules. There is important new information for employers to consider.

Background

Beginning in 2014, an applicable ‘Large Employer” may be subject to a “Shared Responsibility Payment” under one of two different circumstances:

  1. 4980H(a) liability – Applies if an employer does not offer its full-time equivalent employees (and their dependents) MEC – minimum essential coverage, and any full-time employee is certified as having received an ‘Advance Premium Tax Credit’ when purchasing individual health insurance through a public Health Insurance Exchange. In this case, the employer may be liable for a penalty of $2000 per year times the total number of full-time employees (not counting the first 30).

    or

  2. 4980H(b) liability – Applies if the employer does offer its full-time employees (and their dependents) MEC – Minimum Essential Coverage – but the plan is ‘unaffordable’. ‘Unaffordable’ means that the employer requires their full-time employees to contribute more than 9.5% of their annual adjusted house hold income towards the cost of self-only MEC coverage, and at least one full-time employee is certified as having received an ‘Advance Premium Tax Credit’ subsidy when purchasing individual health insurance through a public Health Insurance Exchange. In this case, the employer may be liable for a penalty of $3000 per year times the number of full-time employees who are certified to receive, and purchase, subsidized individual health insurance using an ‘Advance Premium Tax Credit’ through a public Health Insurance Exchange.

Obamacare Employer Mandate

In summary, employers with 50 or more full-time employees must either pay 90.5% of the cost to provide extremely expensive PPACA approved MEC – which includes the Essential Health Benefits Package“, 65 Preventative Care tests and must conform to Community Rating’ and ‘Guaranteed Issue” clauses. It is important to note that these clauses have already destroyed the individual health insurance market in all 8 states they were implemented in. Or, the employer must pay a $2,000 fine for each full-time employee (excluding the first 30 full-time employees).

Or, the employer can simply move full-time employees to part-time employees (less than 30 hours). In doing so they would then avoid both the massive cost to insure everyone and the $2,000 fine for not doing so. Tell me, which action do you think employers will take?

UPDATE: Even though Barack Obama has now delayed this onerous mandate on employers until 2015 the ramifications have already been realized in the latest jobs report with a massive increase in part time workers.


Medicaid expansion places governors, tax payers and employers between a rock and hard place.

Arguably the only ‘good thing’ about U.S. Supreme Court Justice John Robert’s decision in July 2012 to not strike down the PPACA was his decision to provide governors a choice to expand their Medicaid rolls to the levels specified in the PPACA. In fact, this part of Robert’s ruling has been referred to by many as the only ‘silver lining’. In the end, however that perception depends upon who you ask. Many taxpayers are against the expansion because it will most certainly massively inflate state budgets all across the country. Many of which already point to Medicaid as their biggest line item.

Whether you use the Kaiser Family Foundation estimates, the Cato Institute estimates or the Congressional Budget Office. The expansion of Medicaid under the PPACA will put a significant new burden on the taxpayer. This is because the PPACA promises 100% matching federal Medicaid dollars for years 2014 through 2016 and 90% for years 2020 onward for states that elect to expand their Medicaid rolls. Even President Obama’s Medicare Actuary Charles Blahous doubts that promise. Most especially since the President’s own submitted budgets, as well as the bipartisan Simpson–Bowles Commission, and the budget resolution passed by the House of Representatives in 2012 already call for trimming Medicaid spending by a minimum of $100 billion.

And, unlike Supreme Court justice Elana Kagan who famously said during PPACA oral arguments: “It’s just a boatload of federal money to take and spend on poor people’s healthcare. It doesn’t sound very coercive to me.” We taxpayers realize that  ‘a boatload of federal money‘ comes from taxpayers and taxes themselves are inherently coercive.

Whilst the Obama administration touts the fact that the PPACA calls for the aforementioned matching federal funding for those who will be newly eligible for Medicaid in 2014. It is far less vocal about the fact that it only provides the existing or Traditional FMAP percentage match rate for the millions of Americans who were always eligible for Medicaid but either never knew they were or never bothered to enroll. These ‘old eligibles’ will now be required by federal law to maintain minimum essential coverage via Medicaid. Which means that they will all be enrolling in 2014 in order to avoid problems with the IRS. How much will the Traditional FMAP federal percentage match be in 2014? In states like Illinois and others it will be only 50%.

Image

Who picks up the other half? That’s right, the state tax payer. Keep in mind Illinois taxpayers that this new tax increase will be in addition to the 66.66% tax increase Governor Quinn already imposed upon you in January 2011 and the $350 million additional tax increase in May 2012. How much will picking up the other half of the cost to enroll ‘old eligibles’ cost Illinois taxpayers? See the chart below. I’ll bet it’s closer to the CATO institute’s estimate of $10.1 billion.

Image

The Illinois Policy Institute predicts that 1 in 3 Illinois residents will be Medicaid recipients by 2019 if Governor Quinn’s desire to expand Medicaid under the PPACA becomes law in Illinois. Worse yet, on January 30, 2012, the Civic Federation released its “Budget Roadmap” for the coming fiscal year. In it, they highlight the fact that state officials now believe that the Illinois Medicaid program will have between $21 and $23 billion in UNPAID bills by 2017. ‘Forward’…. to bankruptcy.

However, that’s just the cost to Illinois taxpayers. How many people nationwide are ‘old eligibles’? This 2010 article in the New England Journal of Medicine estimates that number to be 9 million Americans. Total cost to the states to enroll all of these ‘old eligibles’ on to Medicaid nationwide will be $931 Billion according to the Congressional Budget Office’s latest assessment. Keep in mind that those CBO assessments are only for years 2014 through 2022. What many governors are concerned about is what such a new commitment will cost state tax payers after the first 8 years? Well, we know what will happen after the first 6 years because beginning in 2020 the 100% federal Medicaid match rate for newly eligible recipients drops to 90%. This means that state taxpayers will pick up the other 10%. That alone will add billions to state budgets. However, a far more important question governors should be asking is what happens after the first 2 years?

You see the PPACA’s answer to improving Medicaid is to raise the amount the federal government pays to doctors who take MedicAID patients to a level commensurate to what the federal government pays to doctors who take MediCARE patients. Their thought process behind doing so is that more doctors will accept Medicaid under this arrangement because the reimbursement rate will be far higher. There’s only one problem. The federal government only provides funding for this massive increase in Medicaid reimbursement ratios for the first 2 years. Afterward, state tax payers are on the hook for the rest.

This, more than anything else related to Medicaid expansion is a fiscal ticking time bomb for state budgets and one that is not being discussed nearly enough. Furthermore, just wait until hospitals – who are forced to treat emergency patients under EMTALA – start pressuring states for reimbursement of more than $11 billion in annual federal payment cuts for uncompensated care. Hospitals are a powerful lobbying force and they will lobby hard for that money.

GOVERNORS AND EMPLOYERS STUCK BETWEEN A ROCK AND A HARD PLACE

Recently Republican governors John Kasich of Ohio and Jan Brewer of Arizona and Rick Scott of Florida have decided to expand their Medicaid rolls under the PPACA. This has left many conservatives scratching their heads since both governors have been vocal public opponents of the PPACA. A closer look at the choice they faced sheds light on their decision. To understand it, we must first understand specifically how the PPACA expands Medicaid.

Prior to the passage of the PPACA, Medicaid was largely used to provide health care services to children of the indigent, their mothers, the disabled and seniors who spend down all their assets to qualify for long term care services. Under the new law childless adults will also be eligible for Medicaid with incomes at or below 133% of the federal poverty level – FPL. Since the PPACA disregards 5% of one’s income, the actual new eligibility level is 138% above the FPL. Using the Kaiser Family Foundation’s “Health Reform Subsidy Calculator we can determine that a childless, adult would be eligible for Medicaid in 2014 if their annual income is at or below $15,302. For a family of four, their income would need to be at or below $31,155. This is a significant new burden on the taxpayer. Not only because 15.1 million childless adults would now be eligible for Medicaid but also because prior to the PPACA, Medicaid eligibility levels were set at 100% of the FPL. In 2012, that was $11,170 for an individual and $23,050 for a family of four in 48 contiguous states and D.C. It is this new annual income level ‘eligibility gap’. Specifically, income levels that fall within 100% and 138% of the FPL that creates yet another new problem for employers.

If a governor chooses to expand Medicaid under the PPACA, all of the newly eligible Medicaid recipients would simply be auto-enrolled onto Medicaid via the new ‘Health Insurance Exchanges’. And, since their income levels will be too low to qualify for a ‘Health Insurance Subsidy’. There will be no ramifications to employers if their employee’s annual income levels fall into this new ‘eligibility gap’. These new eligibles would simply enroll in Medicaid and eliminate the risk to their employers of being fined $2,000 annually for each of them under the PPACA “Employer Shared Responsibility” clause.

However, if a governor chooses not to expand Medicaid, employers in their state with 50 or more ‘full time equivalent’ employees would have to provide PPACA approved health insurance for all of their employees with income levels that fall into this new ‘eligibility gap’. Or else, pay a “Shared Responsibility” annual penalty of $2,000 for each employee (excluding the first 30 employees). Many employers will simply pay the annual penalty instead of providing PPACA compliant health insurance since the law mandates that employers can not require employees to pay more than 9.5% of their annual household income in cost sharing to help them pay for their health insurance. For example, if the cost to insure a single employee is $5,000 annually. The employer can not legally require the employee to pay more than $475 each year to help him/her pay for their health insurance coverage. This means the employer’s annual out of pocket cost to insure that employee would be $4,525. In this near future common scenario, paying the $2,000 ‘Employer Shared Responsibility’ penalty just makes better business sense.

Whilst certain Conservative governors may feel pressured to expand Medicaid because of the above scenario. It is crucial that they stick to their principles and not give in to requests from employers who are seeking relief on a micro level. For expanding Medicaid will do nothing but increase health insurance costs to everyone else, further burden taxpayers of other states. And, require employers to pay much more on a macro level as their tax burdens increase to pay for yet another massive entitlement.

Forbes Rick Ungar vs. C. Steven Tucker on Obamacare. For the record.

On May 24, 2013 Forbes columnist Rick Ungar wrote an article entitled “Unexpected Health Insurance Rate Shock – California Obamacare Insurance Exchange Announces Premium Rates“. In the article Mr. Ungar refers to a press release made the day earlier by Peter Lee – the Executive Director of Covered California – the new Obamacare exchange in that state. In the announcement Mr. Lee stated that the premium required for health insurance purchased in the new Covered California exchange would be lower than expected, significantly lower. This of course let to a veritable jubilee amongst the political Left. The article went ‘viral’ and was shared widely by those who falsely still believe that Obamacare is the solution for the American health care system’s woes.

The truth however is that on it’s face the article is based on a falsehood. A falsehood perpetrated by Mr. Lee himself. You see, Mr. Lee knew that the prices he released to the public in his press release on May 23, 2013 were based on a falsehood. Here’s how we know. On December 26, 2012 Mr. Lee
wrote a letter to HHS secretary Kathleen Sebellius in which he stated the following: “California would like to consider designating a larger number of geographic rating areas in order to minimize rate shock.… We have concerns about the potential rate impact that this may have on younger individuals who are purchasing coverage in the individual market.” So you see, Mr. Lee was concerned about the impact that Community Rating would have on young people in the state of California. Chief amongst his concerns was the fact that because younger people would now be subsidizing the premiums for older people, the cost for young people to obtain health insurance would be dramatically higher.

So, instead of comparing the cost of the individual California Obamacare exchange plans which will be available to individuals in 2014 to the existing individual health insurance plans available to Californians today. He simply compared the rates for individual plans soon to be sold in the California Obamacare exchange to the rates for employer sponsored group health insurance plans available to Californians today. This makes a huge difference because individual health plans sold today do not include the “Essential Health Benefits” that they must include in 2014. Whereas the vast majority of employer sponsored group health insurance plans already include all of the ‘Essential Health Benefits’. Once the ‘Essential Health Benefits’ are added to individual health plans in 2014, the cost will increase substantially.

Less than a week after Mr. Ungar’s article was published, senior fellow at the Manhattan Institute – Avik Roy decided to run the real numbers and respond to Mr. Ungar’s hyperbolic piece in his column also at Forbes. It is a must read. Feeling a bit ‘wonky’ myself. I also felt compelled to post the following comment under Mr. Ungar’s article at Forbes which was picked up by my friends over at IownTheWorld.com. This lead to a one hour debate between Mr. Ungar and myself on the David Webb show on XM Satellite Patriot radio. You can download on MP3 of our debate here.

“This is lunacy. No actuary in the private sector (in their right mind) would publish fixed health insurance premiums 6 months before the release of a health plan. Only a government entity would do something so foolish. Furthermore, these rates assume that Community Rating will work. Community Rating has failed in all 8 states it has been implemented in before. Resulting in doubling, tripling and even quadrupling health insurance premiums in those unfortunate states. California’s HIX – Health Insurance Exchange – rates also assume that people will actually purchase these health plans. Since the ‘fine’ for not purchasing health insurance is only 1% of one’s MAGI – Modified Adjust Gross Income – in 2014. Many will simply pay that miniscule fine instead of purchasing health insurance. Most especially when they can get health insurance on a guaranteed issue basis, regardless of how sick they are during “Open Enrollment”. Once people begin opting out and paying the miniscule fine and waiting until they ‘need’ health insurance (this will happen, it’s human nature). These rates will have to be adjusted UP, significantly UP. It’s just a matter of time. The day of reckoning will come in 2014.

Historical precedent has already been sent. No government health care program has ever remained at or under it’s projected cost. Like the Medicaid special hospital subsidy which was projected to cost $100 million in 1987 and by 1992 costs had soared to $11 billion. That’s more than 100 times more expensive. Or Medicare Part A projected to cost $9 billion in 1965 and soared to $67 billion by 1990. Oh, and then there’s the PPACA – “Obamacare” which had initial cost projections of $960 billion (you know, so Barack Obama could say it cost less than $1 Trillion). Now the PPACA has been reassessed at a cost of $2.5 trillion. But I digress.

Health insurance premiums will continue to rise in 2014. In March of this year, the non partisan, highly respected Society of Actuaries came out with a comprehensive nationwide study on where health insurance premiums will be going post 2014. It does not look good. According to the study, health insurance premiums for individual policies will be increasing dramatically all over the country. Even though president Obama promised that our premiums would decrease under his law. In some states like Wisconsin premiums will increase as high as 80%. It’s important to understand the reason for this.

Beginning in October of this year, the first national “Open Enrollment” period will begin. During this “Open Enrollment” period Americans can purchase health insurance on a guaranteed issue basis without regard to their medical history. This means that many who have ongoing medical conditions will be heavily incentivized to purchase health insurance. Most especially with a federal mandate to do so in place. Whereas the young invincibles, who statistically have very few claims will most likely not purchase health insurance even with the mandate in place because the fine for not doing so is only 1% of their MAGI – Modified Adjusted Gross Income. This amount is so small compared to the high cost of health insurance in the exchanges that many of the young invincibles will simply pay the miniscule fine instead. Even when the fine graduates to a maximum of 2.5% in 2016 many will still pay that small fine instead of purchasing far more expensive insurance. This will lead to an unhealthy risk pool and will force the carriers to raise premiums to compensate for these losses. It’s just a matter of numbers and human nature. It is the nature of man to look out for his own best interests. Paying a miniscule fine instead of expensive health insurance just makes more sense.

The cost to taxpayers will be staggering. Many Americans have heard about the 2.5% tax on medical devices. The capital gains taxes and other taxes imposed under Obamacare but the most costly tax by far is the “Advance Premium Tax Credit”. If you visit the Kaiser Family Institute’s website you will find a Health Insurance Exchange calculator. Using this tool, you can determine right now what you will pay for health insurance in 2014. All you have to do is enter your income, age and the age of your dependents. The calculator accurately displays the premium required for health insurance in the exchange. For a family of four it will cost roughly $15,000 annually. However, if that family’s income falls below 400% of the Federal Poverty level (less than $94,200 annually) they will receive a gift from the taxpayers of more than $10,600 each and every year to artificially lower the high cost of Obamacare approved health insurance. That’s almost $11,000 a year for one family. Now, consider this. According to the Congressional Budget Office 20 million Americans will receive an Advance Premium Tax Credit. Where that money is coming from, I have no idea. Most especially when we are printing $85 billion a month and borrowing .46 cents of every dollar. This is precisely why the projected cost of Obamacare has soared from the initial projections of $960 billion to more than $2.5 trillion.

But that cost is going to be even higher. Once employers with 50 or more full time employees realize that they can reduce their fixed cost for health insurance down to $2,000 per employee (since that is the fine for not purchasing Obamacare approved health insurance). They will simply dump their employees onto the exchanges as a cost saving measure. Watch the CBO’s projections of 20 million receiving Advance Premium Tax Credits to more than double as we enter 2015. Millions and millions more Americans will lose their employer sponsored health insurance coverage. Again, it’s just a matter of numbers and human nature. It is the nature of man, to look out for his own self interest. Paying the $2,000 fine and saving hundreds of thousands of dollars in health insurance premiums is just human nature for the average employer. And frankly, it makes good business sense. Keeping your costs low is crucial for survival in this competitive marketplace. Obamacare is designed to fail. Period.” – C. Steven Tucker

During our debate Mr. Ungar stated that I wrote in this article that I penned for Jeremy Segal at Rebel Pundit.com that “seniors over 70 will be denied care next year”. The truth is I did not write that. I simply quoted the Neurosurgeon who called into the Mark Levin show. Nice try though Rick.

Also for the record, Rick stated that he tried to enroll in the California High Risk health insurance pool (MRMIB) for 5 years and was unable to do so because of ‘waiting periods’. I attempted to educate him to the fact that there are no waiting periods for HIPAA qualified applicants. Meaning one of 2 things:

1.) You are HIPAA qualified (meaning you have maintained employer sponsored health insurance for at least 18 months) and then you lose that coverage to no fault of your own and your employer does not offer you COBRA continuation coverage.

OR

2.) You are HIPAA qualified and lose your employer sponsored coverage, elect COBRA continuation coverage and exhaust that coverage. At the end of that 18 month period the California MRMIB risk pool MUST insure you and cover your preexisting conditions from day one. Providing of course that they are a covered expense on the policy.

The only applicants who wait (and waiting periods are now gone as of 1/1/14) are uninsured applicants who are not HIPAA qualified and attempt to purchase a policy in the individual market and are denied due to one or more preexisting conditions. For proof of this FACT read page 6 of the MRMIB application.

Lastly, Rick attempted to criticize me for not having any friends on the Left of the political spectrum. To clarify, I will use Webster’s definition of the word “friend”. Friend – Noun: a person you know well and regard with affection and trust. 

I do not trust the Left. So I do not have any ‘friends’ on the Left. For it is the Left who support Barack Obama. It is the Left who supported and voted for Obamacare. Not one Republican did.  It is the institutional Left, of which Rick is a proud member and defender who still support a president who has no regard for the rule of law, our Constitution or individual Liberty.

I do have a few acquaintances on the Left. They are not my friends, but they are learning the meaning of Liberty. When they fully understand individual Liberty and agree to embrace our Constitution and the rule of law and agree to fight for and protect the civil society. I will indeed consider them my friends. But friendship is earned and no matter what battle ground you are fighting on, a Patriot does not befriend the enemy.

P.S. Rick, per your request, I did indeed call the MRMIP program today and they verified precisely what I stated above.

 
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