Monday, August 15, 2011

Newly Proposed Treasury Regs for Obamacare Premiums

The Treasury Department announced Friday proposed regulations for tax credits for employees who purchased health insurance through Affordable Insurance Exchanges. The regs also assign $185 million in grants to 13 states plus D.C. to establish the exchanges. The exchanges would supplement employer-provided and government-provided health insurance programs and would generally support families earning 100% to 400% (generally about $22,500 to $90,000) of poverty-level income. Estimated benefits to employees/cost to taxpayers would be an average of $5000 per employee for 20 million Americans (NOTE: since the 20 million seems to include dependent children and stay-at-home spouses; the amount would be less than the apparent $100 billion.) It appears that this credit would be fully refundable, thus similar to the Earned Income Credit. Employee payments will be phased up as income increases. Additional regulations for employers regarding minimum required insurance value are forthcoming.

A lot of the reaction to this will be based on one's opinion of Obamacare. The comparatively least political reaction that I can come up with is: while the act adds 17-20 million people to the healthcare system; I see no indication that ANY new healthcare personnel will be added. Therefore, it looks to me like healthcare ACCESS may become a problem (or more accurately, larger problem--it is already difficult to find a physican willing to spend more than about 10-15 minutes per patient per visit) with the new law.

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