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Title: A whopping 87 per cent of Obamacare customers to get taxpayer-funded subsidies in 2015 – but the Supreme Court could throw out the whole $65 BILLION system
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URL Source: http://www.dailymail.co.uk/news/art ... ies-illegal.html#ixzz3NS0srsM8
Published: Dec 31, 2014
Author: David Martosko
Post Date: 2014-12-31 02:37:22 by out damned spot
Keywords: Obamacare, subsidies, 2015
Views: 5682
*HHS said Tuesday that about seven out of every eight Obamacare enrollees will get government help paying for their medical insurance policies *That number was 80 per cent a year ago *People on Obamacare can get subsidies if their households earn less than four times the federal government's official 'poverty' level *Sixty-four per cent of Americans have small enough incomes to qualify, meaning that Obamacare customers are disproportionately poor *Entire $65 billion subsidy system could become illegal next year, depending on how the Supreme Court rules in a landmark case About seven out of every eight Obamacare insurance customers who enrolled between November 15 and mid-December are poor enough to qualify for taxpayer- funded subsidies designed to lower their monthly premiums. The Department of Health and Human Services reported that number Tuesday, saying it's up from 80 per cent a year ago. Americans who participate in government-brokered medical insurance can get subsidies from the federal treasury if their households earn less than four times the government's official 'poverty' level. That situation describes 64 per cent of all U.S. residents, according to the Kaiser Family Foundation. But far more are qualifying, suggesting that the Obamacare subscriber base is dramatically tilted toward low-income earners. And as poor Americans depend inreasingly on handouts to manage their monthly health insurance bills, the U.S. Supreme Court could be months away from invalidating the entire subsidy system that supports the 34 states that chose not to run their own Obamacare marketplaces. Outgoing California Democratic Rep. Henry Waxman estimated two weeks ago that as much as $65 billion in government payments to Americans in those states is at risk. The Supreme Court case, King v. Burwell, hinges on whether the government can legally distribute subsidies in states that use the Healthcare.gov online exchange instead of running their own. The law’s language is plain: Subsidies can only be paid through exchanges created by the states. Democrats in Congress, defending President Barack Obama's signature law, insist a drafting error is to blame. They say they intended for people in all 50 states to be eligible for subsidies. But Jonathan Gruber, the one-time Obamacare 'architect' whose unguarded, videotaped comments about the law drove him to apologize before Congress this month, thought differently in 2012. 'What’s important to remember politically about this,' Gruber told a group of consultants at the management firm Noblis, 'is if you're a state and you don’t set up an exchange, that means your citizens don't get their tax credits – but your citizens still pay the taxes that support this bill.' 'So you’re essentially saying [to] your citizens you’re going to pay all the taxes to help all the other states in the country,' he warned. 'I hope that that's a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these exchanges.' Insurers are bracing for the possibility that 87 per cent of their new customers in the 34 states without insurance exchanges could suddenly find Obamacare policies financially out of reach – leading to lapsed premiums and a systemwide collapse. Some companies have slipped excape clauses into their policy contracts, The Daily Caller reports, allowing them to cancel the plans if the high court invalidates the subsidies. Tuesday's HHS report included data from only one month; the open enrollment period stretches through February 15. 'About 87 percent of people who selected health insurance plans through HealthCare.gov for coverage beginning Jan. 1, 2015 were determined eligible for financial assistance to lower their monthly premiums,' the agency reproted, 'compared to 80 percent of enrollees who selected plans over a similar period last year. Obamacare subsidies can come in the form of tax credits that compensate for varying percentages of premiums. They can also consist of government payments that directly lower enrollees' out-of-pocket costs. Tax credits are available to everyone earning less than 400 per cent of the poverty limit. Those under 250 per cent of that benchmark can get the direct subsidies for 'silver' level insurance policies.. The final cost of insurance is capped at 9.5 per cent of total income for anyone who qualifies. At 138 per cent of the poverty level, Americans become eligible for Medicaid and pay nothing for their care. The poverty limit for a family of four in 2014 was $23,850, and will increase in 2015 with inflation. That means a two-parent household with two children can get government help for Obamacare this year unless its earnings top $95,400. Income below $32,913 makes the family eligible for Medicaid coverage. According to a Kaiser Foundation online calculator, the same family could opt for an $8,290 'silver' level insurance policy and pay about $600 for it after subsidies are applied. With a $50,000 family income, they would only be responsible for $3,300 in premium payments for the year.
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