Today, the Obama Administration officially announced the penalties for Americans who choose not to purchase insurance under the new Health Care Affordable Act.
Beginning on January 1, 2014, Health Insurance Marketplaces as they will become known as will be the new way to find/purchase health insurance coverage, should your employer elect not to cover you any longer. “On these Marketplaces”, says an administration spokesperson, “some people may be eligible for lower costs on health care premiums.” The emphasis here we guess is on the words “some” and “may be.”
In addition, just in case you inadvertently forget to purchase what the administration calls the “minimum essential coverage,” you will pay a penalty when filing your taxes. This payment will either be a flat fee or a percentage of your taxable household income, whichever is HIGHER! The penalty will be phased in as follows:
$95.00 or 1% of your taxable income in 2014
$325.00 or 2% of your taxable income in 2015
$695.00 or 3% of your taxable income in 2016
The administration states that “exemptions from this penalty payment will be granted under certain circumstances,” however did not explain what those exemptions are or how one goes about applying for such exemption.
Suffice it to say that if you earn $85,000 in 2015 and your taxable income that year is approximately $70,000 and you have not purchased the “minimum essential coverage” the government states you have to have, you can plan on paying the IRS an additional $1,400.00 in penalties. ($70,000 x 2%). It sure is going to be interesting to see what the rates are for purchasing health insurance at these “Marketplaces.” It may turn out to be cheaper to pay the penalty to the IRS. We will find out shortly.
In other health care news today, the State of California announced that a woman may not require having a doctor present when having an abortion. I guess that is one way to bring the cost of health care down. I just wonder what the baby would have to say about that!