(Better do it before March 31st)

There are two things people say to never bring up at family gatherings or dinner parties: politics and religion.  Both subjects can ignite an argument because of strong opinions and can cause hurt feelings and lots of head scratching. I’m sure there are a few other things you can add to that list (tattoo’s, The Cleveland Browns, Lebron James, etc.)

Lately the most riveting subject that has people polarized is the Affordable Care Act (ACA), better known as Obamacare. The arguments against it are as long as this epic winter we have been having, starting with the fact that the law was passed without anybody knowing what was in it; then there was the botched Healthcare.gov website launch which still doesn’t work half the time and finally the endless changes that continue to be made once the President realized he made a promise that wasn’t even written into the law when he said, “ if you like your plan you can keep it, period.”

So with all that being said and at the risk of potentially offending some of my friends and business associates who are on the right side of this issue politically,  I must admit that I have seen some things in this law that are helping people with modest incomes and pre-existing health conditions .

There are 4 different “Metal Plans” to choose from on the public or private exchange marketplace: Bronze, Silver, Gold and Platinum.  Depending upon your income and family size, money is available in the form of a subsidy to reduce your monthly premiums for insurance as long as you purchase the coverage through the public marketplace exchange. In addition, the “Silver Plans” offer a reduction of deductibles and out of pocket expenses for people in certain income ranges.

My opinion began to change when I saw some of these plans in action. We have a client who is 29 years old, married with 2 children. He was paying  $640.00/month for his coverage. His household income qualifies his family fora premium subsidy of $507.00 a month. The plan he chose cost $742.00 /month or a net of only $235.00 after the subsidy; a savings of over $400.00/month for a better health plan. That’s a big swing financially every month for a young family. That extra money could be used to pay off debt, build an emergency fund and perhaps begin a retirement plan.

This is just one of many examples I have seen in the last few weeks. I’ve also seen the impact of how the ACA works for older people with pre-existing health conditions who don’t qualify for subsidies. One couple, both age 62 , can now  easily move to a better health plan with no questions asked and pay $600.00/month less in premiums, which isn’t peanuts . In fact that’s pretty hard to argue with.  

However, the thing we all must realize is that somebody is going to have to pay for all of these “subsidies” and “savings”, and that somebody is us. Sooner and later we will all feel the effects of this law in the form of higher taxes, insurance premiums, fines and penalties. The penalties begin as soon as April 1, 2014 for any individual who has not signed up for health insurance.

For many individuals and families, the penalty for not having health-insurance coverage will run a lot higher than the $95 figure often cited. For example a married couple with two kids making $50,000 a year on the adjusted basis — the penalty for not having insurance could run over $300 a year. The same couple making $100,000 a year on this basis could be subject to a fine of about $800. That’s according to the Tax Policy Center, which has just rolled out the ACA Tax Penalty Calculator. The calculator helps people figure out how large their tax penalty will be if they fail to obtain required health-insurance coverage. The penalty will increase in 2015 and again in 2016.

If you don’t sign up by the deadline, not only will you pay a tax penalty, but you’ll be uninsured until 2015 because you can’t buy coverage between open enrollment periods except in a FEW specific circumstances such as: losing employer coverage, job loss, divorce or moving to another state.

Fortunately we can help people cut through all the Obamacare red tape with our exclusive Ramsburg Health Instant Quote System. One click and you can begin comparing plans from the area’s most respected health insurers, determine if you qualify for a subsidy, apply and be accepted in a fraction of the time it takes by going through healthcare.gov.

The healthcare law is here to stay -for now. Our role is to help clients with solutions that provide them with financial security by using the best insurance and financial products available to us. I don’t think too many people can argue with that.

Will Adamczyk is a Certified Financial Planner with Ramsburg Insurance and Financial Services. He focuses on benefit and retirement income planning  for the baby boomer generation.

Posted 5:59 PM

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