For people purchasing insurance over the exchanges are the savings factored into the cost that they'd be paying already or are they tax credits? ie. if you have a $1,000 USD plan and was going to discount it by $300 does that mean you'd be paying $700 up front or that you'd pay $1,000 up front and then you'd get back $300 extra on your tax refund at the end of the year? The latter doesn't really help people who are hurting for money..
In fact, it also seems to me that if your income is below the standard deduction for taxes ($6,350) then the impact to you would pretty much be non-existent. You're already not paying anything in taxes so there's not gonna be anything left over to refund you for your insurance. Altho I suppose this could be where the expansion of medicaid kicked in.
How do payments work? I'm assuming you can pay in installments. Can you pay with via ACH or get snail mail bills that you pay by check? What happens if you just don't make one of your monthly payments? Does the insurance provider drop you? It seems to me like plans for poor people would be at increased risk of people making non payments.
ObamaCare fines people for lack of insurance. Quoting https://www.healthcare.gov/medicaid-chip/medicaid-expansion-and-you/,
If your state hasn’t expanded Medicaid, your income is below the federal poverty level, and you don't qualify for Medicaid under your state's current rules, you won’t qualify for either health insurance savings program: Medicaid coverage or savings on a private health plan bought through the Marketplace.
Will you get fined in this situation?
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4This appears to be a question about personal financial consequences of the ACA, not questions about the political processes which lead to it or its macroeconomic effects. That makes this question a better fit for money.SE than politics.SE. I've migrated it, but I think this question might work better as three separated ones. You might want to think about splitting it into three separate questions on money.SE.– PhilippCommented Jan 16, 2017 at 16:23
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What "savings" and "discount" are you referring to in question 1? Are you referring to the subsidies paid by the government to offset your premiums?– BrenBarnCommented Jan 16, 2017 at 19:14
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@BrenBarn - yes.– neubertCommented Jan 16, 2017 at 19:52
2 Answers
1) When you apply for insurance you indicate your expected income, they figure the subsidy based on this. Note that while this data isn't checked it's only an estimate, any errors will be fixed at tax time so lying is just going to gain you an unpleasant tax bill come April 15.
2) It's not paid in installments, it's just a monthly premium. It's quite possible for someone to be on the ACA for only part of a year.
3) I can't address the issue of the fines. However, you are wrong on who it's for--it's for anyone who doesn't have employer-provided insurance, whatever the reason. I've been on it since it's inception because I have been self employed for most of that time--there's no employer to even offer me insurance.
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I expanded my question for # 3. healthcare.gov itself talks about situations where you wouldn't qualify for coverage from an exchange.– neubertCommented Jan 16, 2017 at 22:46
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@neubert No, that's talking about the subsidies. Such a person can still get ACA insurance if they can somehow come up with the money. Commented Jan 16, 2017 at 22:47
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"any errors will be fixed at tax time so lying is just going to gain you an unpleasant tax bill come April 15." Well, paying money later is always preferable to paying money now. If you could pay less now and just make it up at tax time, that would be borrowing money from the government for free, which is not unpleasant at all. Commented Jan 18, 2017 at 3:38
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1@user102008 You owe too much and you get underpayment penalties. It's not free borrowing. Commented Jan 18, 2017 at 5:27
To answer #3 specifically, there are a number of exemptions from The Individual Shared Responsibility Payment (the "fine" or "penalty" for being uninsured). One of those is:
You lived in a state that didn’t expand its Medicaid program but you would have qualified if it had.
That exemption (others may well apply based on income to many people in this category) applies for the entire year if:
You live in a state that hasn’t expanded its Medicaid program under the Affordable Care Act
[and]
Your income and household size would have qualified you or your family for Medicaid if the state had expanded coverage
As such, people who are stuck in the Medicaid gap in those states will not be fined. People in this category also have a special option to enroll in a non-Medicaid plan if their estimated annual income increases later in the year, even outside the normal enrollment period.
