Which probably translates roughly as: a race to the narrowest networks. Cheaper, yeah, but I can see the day when a lawsuit’s filed, under some civil rights statute or another, complaining of discriminatory access to qualified doctors. What I can’t see is the administration that brought the ACA into being named as a defendant.</p>
<p>I’m all for personal responsibility, even though it runs counter to the whole concept of subsidization, but I have doubts the people that had to be begged to even sign-up are going to devote enough attention to what’s likely to be a pretty complex problem for them:
Likeliest is: the tax bill just eats up an EIC refund but I doubt the consumer’s going to be very happy about his/her whole ACA experience.</p>
Getting group coverage for group consisting of only husband/wife pre-ACA was a loophole that was open to a few. Married couples who didn’t happen to be self-employed couldn’t get it, and many who were self-employed couldn’t get it either, because the insurance companies could pick and choose who they were going to employ.</p>
<p>The net effect of ACA is that everyone buying on the individual market has the same set of choices, at the same costs – rather than some being able to get more favorable rates than others. The self-employed still get plenty of benefits: they can deduct 100% of their premium dollars from their tax return – which in itself functions as a government subsidy, equivalent to their marginal tax rate. (If the marginal tax rate is 28%, then the government is paying $280 for every $1000 of increased premium amount) . By definition,the married couple who suffers because they no longer can buy a group policy has to be earning a lot - for a 2-person household, that means an AGI of more than $63K after deducting 100% of their health insurance premiums, their contribution to a self-employed retirement plan and half their self-employment tax. So I’m figuring that if the cost of health insurance is $20K/year, the total income (before adjustments) must be something upward of $100K. Actually, given the ability of self-employed people to manipulate their own income for tax advantages - such as investing money back into their business, in most cases it is probably even higher. (I mean, if a business owner earns enough that puts them $5K over the threshold for subsidies, and that works a $10K difference in the cost of premiums --it seems to me that it would make sense to pour that $5K back into the business, maybe buy new equipment or office furniture or whatever.)</p>
<p>@catahoula – the problem with the example of the individual with the $17K income - 150% of FPL – is that the maximum clawback at that income level is $300. So that person who was paying $50/month is now paying a modest increase – and an a maximum of $25 per month ($300 total) at tax time. In the meantime the person is getting insurance at a rate that would have been inconceivable in recent years – and they will see the actual numbers on their form 1095A. </p>
<p>So let say that the insurance premium is was $350 a month and goes up to $375 with the 5% increase plus higher age category. Monthly payment to the insurer was $50 and is now $75. And now the new benchmark plan is “Health Scrooge HMO” which only charges a premium of $310. So taxpayer has a year end statement that shows his insurance cost $4500 for the year, and that he paid $900 of that out of pocket, and that the government paid $3600 when he only qualified for $2820 – and that the benchmark plan would have cost $3720. So he’s received $780 more from the government than he was entitled to…and now he he has to pay $300 back. </p>
<p>I realize that there are plenty of people who are going to have a hard time making sense of that --but it looks to me like the low income subsidized taxpayer is still coming out ahead. Plus he’s learned a lesson for year #3 and the auto-renewal process.</p>
<p>I do not understand this statement. What did the insurance companies have to do with small business employment? A H and W business was a group if they owned and ran the business. The business had to be structured as either W2 income or K1 income, LLC or LLP - really not difficult, nor a loop hole’. Now, this business configuration is not a group - for no reason other than well because - well…because… Reclassifying this type of business is not the closing of a loop hole, but rather a blatant push of those who do not have the appropriate clout into a newly structured system which need financial support. Let’s at least call it that and be honest.</p>
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<p>Family businesses are just that - family. Many a family business incorporates the children, brothers, sisters, aunts, uncles, parents etc. None of those are now considered valid employees - they are now simply ‘family’ and do not qualify for group coverage. It seems like a rather straightforward attempt to make small family businesses harder and harder to maintain and operate. Also, in what scenario is 63K for a two person household considered ‘earning a lot’? Medical expenses are that - expenses. So deducting those expenses leaves a massive 63K for 2 people and it is considered ‘a lot’ of income? Wow, talk about policies that are counter to supporting families.</p>
<p>Dietz, I believe calmom had a typo, and meant to say that insurance companies could pick and choose who they were going to INSURE. That is, they could decide not to insure Mr. and Mrs. Emphysema’s company; they didn’t have to offer insurance to every small business that applied. And they might have charged Mr. and Mrs. Diabetes’ company a huge premium.</p>
<p>As I pointed out, Dietz, when you factor in available deductions and write-offs available to the self-employed, including the fact that the insurance premium is 100% deductible, the $63K MAGI probably equates to $100K+. Which puts that couple in a much better position than, say, a married couple of two wage earners making $32K per year, but not receiving employer provided insurance – they have to pay the same rate for insurance as you without the ability to sock away 20% of net earnings in a SEP-IRA or subtracting their entire health insurance premium from their taxable income. </p>
<p>If a small business is employing brothers, sisters, aunts, uncles, etc and putting them on the payroll, they definitely are employees and the business can qualify for group coverage.</p>
<p>The idea is that an employer is qualifies for group coverage if an when that employer steps up to the plate and is willing to shoulder some of the cost of insuring someone who is not a member of their household. If not-- if it’s just a husband and wife who want to insure their own family - then they have to pay the same rates as every other couple. Though as noted, they still get the benefit of the whole array of tax-saving and MAGI-reducing deductions.</p>
<p>If the H and W were classified as a group the insurance company could NOT pick and choose. There were no pre existing condition clauses, no other qualifying condition requirements. The ONLY requirement was that the H and W business be a group. So no, your assessment of the situation is incorrect. Group coverage was outside of the hassles of individual coverage. This is what makes kicking mom/dad and family out of group coverage such a big deal.</p>
<p>In our case, we qualified as a group because of the type of business. All H and W’s in this type of business were lumped together as a group. No one had to pass a physical, no one was excluded due to health issues. There was a different RAF (Rating factor) based on the size of the group. H and I had a multiplier of 1.3. If our group was larger we would have had a lower multiplier. A carrier could decide to drop an entire group (which did happen at one point). Another carrier, or another group would then adopt the dropped group…and Voila…group coverage continued. </p>
<p>Really, kicking family businesses out of group coverage is a clear and distinct message. This is a big big big deal. The rather off the cuff comment of - well simply add an employee - is insulting. Many a family business runs on a tight margin and adding a arms length employee is not an option. Small family run businesses have been given a boot to the head with this new law.</p>
<p>But…D significant other did offer to let us employe him at the absolute minimum wage requirement and the to simply give back the funds. Hmmmmmmm…an option worth pursuing.</p>
<p>This is not what I was told by my broker. It needed to be an arms length employee and direct family members did not count. Family business often have family members who work and get K1 distributions. </p>
<p>Why do you think H and W business were specifically targeted by the ACA? Are you saying 100K is an income level which needs to be targeted?</p>
<p>OT, but today I scheduled my two routine annual exams. I’m seeing the specialist two weeks from today, which is a typical wait time. I’ll see the primary in 7 weeks; usually it’s closer to a 3-month wait to see her. (For urgent appointments, I can always get in within a day or two for both docs.) I know that in some parts of the country these sound like shockingly long wait times, but CA has had a doctor shortage for many years, especially primaries, long before ACA came along. </p>
<p>I know some were worried that the newly-insured poor people would hog all the doctor appointments. No effect here. </p>
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<li>this was not true prior to ACA and not true now.
A husband and wife in even a C-corp (mine is) could NOT qualify for group insurance without at least 1 additional W2 employee.</li>
</ul>
<p>Also, the h & w in question, even as W2 employees, are not eligible for the SHOP tax credits on their premiums. The SHOP credits can only be applied to the premiums of the other employees.</p>
Considering how difficult it was to even sign up, how many subsidees are going to be willing to go through all that again? The article said most Medicare recipients never change their supplement, and neither do federal employees switch their health insurance coverage. So who really thinks the subsidees will? I don’t. That clawback provision is pretty sweet, and it amounts to even more subsidization for many of them. </p>
<p>You need at least one W-2 earner. The first W 2 job I ever had as a teenager was working for my father. He gave me a paycheck, took withholding, and followed all the rules. Being a relative is no impediment to employment.</p>
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Because it’s a clear abuse of the distinction between a group vs. individual coverage in the health marketplaces if a h/w with no employees is treated as an employer “group”. As I pointed out above, the SHOP plans are intended for employers who are willing to pay for coverage for an employee. </p>
<p>If you don’t have employees, then you are just like every other married couple out there: you don’t get special privileges just because you happen to have a business. </p>
<p>Historically, insurance companies could deny coverage based on medical underwriting. However, under HIPAA (passed in 1996), group policies had to be guaranteed issue, and HIPAA enabled anyone with 2 or more employees to form a group to buy insurance. So there would be a situation where a self-employed person couldn’t get coverage due to medical issues, and establishment of a HIPAA-compliant group was the only path to getting insurance at all.</p>
<p>ACA requires guaranteed issue to all – hence there is no longer a distinction between group vs. individual coverage when it comes to qualifying for insurance. So there is absolutely no reason to be selling group insurance to a married couple with no employees – they are eligible to buy on the individual exchange,and if their income is modest enough, to get whatever tax credits they may be entitled to. </p>
That would be interesting! And let’s include all employer coverage, too, including the self-insured employers. Even including the bloated insurance packages offered to federal, state and often municipal employees. Those taxpayer-subsidized workers shouldn’t get better coverage/access than most of the U.S.</p>
<p>JMO. Not sure it’s discriminatory access. You can go to a competent doctor. The law says doctors need to pass certification and be licensed, in order to practice. The issue is whether your ins co and your plan are obliged to pay for your specific, special, “I want” choices and/or to what extent (in-net vs OON, if at all.). The test may be whether your own expectations are reasonable. The courts will look at that. Thus, Cedars or Specialist X may not pass the test that they are your only true options. And, most of us (all?) already have provisions where the ins co will consider treating exceptions as in-net (eg, the only surgeon who performs that procedure is out of area or at another facility.) This isn’t as simple or instantly gratifying as, “Hoho, I want what I want, we’ll show them, we’ll sue.” </p>
<p>And assuming people won’t review their coverage doesn’t place the blame on the govt. So, it’s the same old song on this thread. You want what you want, you want customization for you, and you want it paid for by someone else. And you can’t see that, if everyone said that and got their way, it couldn’t function. No matter how you perceive your coverage in the past. No matter what you thought or someone else thought. </p>
<p>Anyone can sue, of course, but who is going to sue here, and who are they going to sue? Doctors can choose who they treat, as long as they don’t discriminate against a protected class. “People who don’t want to pay” is not a protected class.</p>
<p>Interesting question. There are also doctors upset about this situation, of course. It’s not as though the physicians are picking and choosing patients. Sometimes they’re also surprised to find out that a particular patient isn’t covered. </p>
<p>If there is no doctor who can see you within what’s considered a reasonable and ordinary time frame, it’s different. But waiting 7 weeks for an annual, when sick care (doctor, nurse, PA/NP, etc,) is available within X hours, isn’t cruel and unusual. </p>
<p>Several times, the phrase “qualified doctors” has been used. This isn’t about that you, the layman, think Doc Jones is the only one “qualified” to treat you. It’s about what is available. Same old Community Hospital vs Cedars issue. </p>
<p>Except that Cedars is available if you are so lucky as to have employer insurance. It is a little strange and perhaps discriminatory if a self-employed person is shut-out. Some enterprising lawyer could probably have fun with that case.</p>