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As Insurance Prices Rise, Americans Opting To Pay The ObamaCare Penalty

- January 17, 2016

Many Americans Are Opting To Pay The Penalty For Not Having Health Insurance Because It Is Cheaper Than The Least Expensive Insurance Available To Them

More Than Seven Million People Eligible For Coverage Under ObamaCare Would Actually Pay Less If They Accepted The Penalty For Not Having Insuarnce. "People, like Mr. Murphy, who earn too much to qualify for federal subsidies that defray the cost of coverage may be most likely to opt out. A recent analysis by the Kaiser Family Foundation found that more than seven million people who are eligible for exchange coverage would pay less in penalties than for the least expensive insurance available to them. More than half would not qualify for subsidies, the analysis found." (Abby Goodnough, "Many See I.R.S. Penalties As More Affordable Than Insurance," The New York Times, 1/3/16)

  • An Engineer In Texas Will Save Over $1,100 By Opting To Pay The Fine Instead Of Getting Health Insurance. "Mr. Murphy, an engineer in Sulphur Springs, Tex., estimates that under the Affordable Care Act, he will face a penalty of $1,800 for going uninsured in 2016. But in his view, paying that penalty is worth it if he can avoid buying an insurance policy that costs $2,900 or more. All he has to do is stay healthy." (Abby Goodnough, "Many See I.R.S. Penalties As More Affordable Than Insurance," The New York Times , 1/3/16)

The Combination Of Premiums And Deductibles Can Exceed $10,000 Making The Penalty Seem Like A Deal Even After The Penalties More Than Doubled. "Many holdouts have made their decisions after meticulously comparing the cost of insurance premiums and deductibles with paying for doctor appointments, lab tests and prescriptions themselves. For some healthy people, the combined cost of premiums and deductibles, which can exceed $10,000, makes the penalty seem a better deal." (Abby Goodnough, "Many See I.R.S. Penalties As More Affordable Than Insurance," The New York Times, 1/3/16)

  • Fines For Going Uninsured In 2016 Average Nearly $1,000 Per Family. "Fines for being uninsured rise sharply in 2016 - averaging nearly $1,000 per household, according to an independent estimate. It's forcing those in their 20s and 30s to take a hard look and see if they can squeeze in coverage to avoid penalties. Many are trying to establish careers or just make progress in a still-bumpy economy." ("Health Care Fines Press Millennials as Deadline Nears," Associated Press , 1/27/16)
  • For Individual's, The Penalty Rises To $695 In 2016 From $325 In 2015. "The minimum penalty rises to $695 in 2016 for someone uninsured a full 12 months and not eligible for one of the law's exemptions. That's more than double the corresponding figure of $325 for 2015." ("Health Care Fines Press Millennials as Deadline Nears," Associated Press , 1/27/16)

Americans Who Do Have Insurance Can't Afford The High Cost Of Their Deductibles

Rising Costs "Threaten To Undercut The Law's Popularity With The Customers It Relies On The Most: Relatively Healthy People." "Insurers have raised premiums steeply for the most popular plans at the same time they have boosted out-of-pocket costs such as deductibles, copays and coinsurance in many of their offerings. The companies attribute the moves in part to the high cost of some customers they are gaining under the law, which doesn't allow them to bar clients with existing health conditions. 'The result is that many people can't avoid paying more for insurance in 2016 simply by shopping around-and those who try risk landing in a plan with fewer doctors and skimpier coverage.' These dual realities threaten to undercut the law's popularity with the customers it relies on the most: relatively healthy people. Their participation is vital to offset the costs of sicker people who can buy coverage at equal prices for the first time under the law; if the healthier ones pull out, that would put additional upward pressure on premium prices." (Louise Radnofsky, Paul Overberg and Stephanie Armour, "Rising Rates Pose Challenge To Health Law," The Wall Street Journal, 11/18/15)

Many Families Are Foregoing Needed Medical Care Due To High Deductibles. "Nearly 30 percent of people insured through the federal marketplace who had deductibles higher than $1,500 went without needed medical care in 2014 because they could not afford it, according to Families USA, a health care consumer group based in Washington. That includes diagnostic tests, treatments, and follow-up care as well as prescription drugs." (Tracy Jan, "Critics Say High Deductibles Make Insurance 'Unaffordable,'" The Boston Globe , 11/16/15)

  • Out-Of-Pocket Costs Are Forcing ObamaCare Consumers To Drop Coverage Altogether. "Cost concerns have lead tens of thousands of the newly insured to drop their Affordable Care Act plans and opt for free or discounted care at community health clinics. Consumer advocates worry that the numbers will increase as the trend toward high deductibles worsens." (Tracy Jan, "Critics Say High Deductibles Make Insurance 'Unaffordable,'" The Boston Globe , 11/16/15)

A Family That Once Volunteered For The Obama Campaign Are Dismayed By The Cost Of Their Health Plan, Saying "We Can't Afford The Affordable Care Act." "'This law was going to give people a chance,' said Cassaundra Anderson, 44, a freelance proof reader. But in April, when Roger Anderson fell while hiking and hurt his shoulder, he discovered, to his dismay, that simply being insured was not enough. The Andersons' mid-tier plan, which costs them $875 a month, requires them to meet a $7,000 deductible before insurance payments kick in. 'We can't afford the Affordable Care Act, quite honestly,' said Cassaundra Anderson, whose family canvassed for Obama in their neighborhood." (Tracy Jan, "Critics Say High Deductibles Make Insurance 'Unaffordable,'" The Boston Globe , 11/16/15)


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