Healthcare Law Glitch Will Leave Many Without Insurance
In somewhat unexpected news, there appears to be a serious crack in the healthcare law, one which may "price out" millions of families from healthcare coverage altogether. The issue recently came to light when confusing language in the new law appears to carve out lower income families who do not qualify for Medicaid, requiring them to either pay more for their employee sponsored health insurance or go without insurance.
The problem arises because the law redefined what employers are responsible to pay for insurance. Under the law, an employer will face a penalty if the premiums are so expensive that a worker would qualify for a subsidy. Subsidies are available for unaffordable coverage, deemed as 9.5% of a worker's household income. The problem is that the benchmark used is cost of an individual policy, not a family policy. Anyone who pays for health insurance knows it is often 3-4 time more expensive for a family policy than an individual, so if you base the calculation on an individual policy, not very many people would qualify for the subsidy and the employers are not responsible to make up the difference.
The numbers certainly are staggering. There are as many as 4 million households, including 500,000 children, affected by this glitch. Using 2011 figures, a family making more than $9,700 per year would be ineligible for a subsidy, while the cost of that plan for a family is actually more than $4,000 per year, far more than most families can afford without some assistance from the employer or the government.
This article is provided for informational purposes only. Nothing in this article shall be construed as legal advice or should be relied upon as such. Michael LaMagna is a partner at The Law Office of LaMagna & Associates, PC, practicing Health Care Regulatory, Elder /Probate/Disability/Trusts and Estates, Social Security and General Legal practice in both New York and Connecticut. Email him at Mlamagna@nyandctlaw.com, call him at 914-534-1048 or visit Attorney LaMagna's website at www.nyandctlaw.com for more information. You can also follow Attorney LaMagna on Twitter@michaellamagna1.