Regardless of what you may think of the Affordable Care Act aka Obamacare, the Census Bureau reported that over 17% of us had no health insurance in 2010 (http://www.census.gov/prod/2012pubs/p70-133.pdf) . This is understandable given the number of small employers out there, the number of folks who have to work as independent contractors or those who have to string together a number of part-time gigs to make a living. Small group and individual health insurance for most us in these groups is prohibitively expensive. An accident or serious illness can easily set the stage for a personal financial disaster or at least an ongoing drain on community resources.
October 1st brings the opening of an Insurance Marketplace, formerly called an Exchange, to Illinois. It is a State/Federal partnership. This program will allow you to obtain subsidized health insurance if your income is below 400% of the federal poverty level. That is nothing to sneeze at (pun intended) since that figure for 2013 rests at $94,200 for a family of four. The Congressional Budget Office estimates that 56% of those who buy their health insurance at the Marketplace will receive some form of a subsidy. Open enrollment will begin this Oct. 1st for the Marketplace and it's subsidy benefits will close for the year on March 31, 2014. The insurance would be effective January 1st. If you don't take advantage of the subsidies and still can't afford to buy health insurance you may face some eventually hefty tax consequences ($695 to $2,085 in 2016). The tax penalties will be phased in over the next several years. Next year the penalty will be approximately the greater of $95 or 1% of your household income. The next open enrollment period will begin on the following October 15th. However, if you get married/divorced, have a kid, lose your group health insurance you can buy insurance from the Marketplace at that time. The reason for the enrollment periods is fairly straight forward. Imagine how costly dental insurance would be if you could buy it at any time and it immediately covered your kid's braces!
There are many options for employers. There are mandates for employers who have 50 or more FTE employees. There are additional tax considerations for high income earners and those with investment income.
So as an individual in need of health insurance or a small business that would like to offer the benefit to your employees, now is the time to start doing your homework. If you are a larger business with 50 or more FTE employees disussing this issue with your benefits provider is imperative.
Here are a few websites that have been passed on to me for those of you wishing to dig a little deeper into this and take advantage of ACA's potential advantages:
www.healthcare.gov, www.healthreform.kff.org, www.sba.gov/healthcare.
Remember that the information provided here for informational and discussion purposes only. You should discuss and verify all of this information with your own CPA, attorney, insurance agent, etc... in light of your own personal situation.
