HEALTH INSURANCE EXCHANGES - Financial Incentives and Disincentives (Series Part 4)

"How Do the Health Reform Law's Financial Incentives and Disincentives Work?" PBS Newshour 9/20/2013

Excerpt

SUMMARY:  Even as Republicans are trying to shut off funding for the law, the Obama administration and some states are preparing for implementation of the Affordable Care Act.  Julie Rovner of NPR joins Ray Suarez to answer some of your frequently asked questions on tax credits and subsidies, as well as penalties for not having insurance.

RAY SUAREZ (Newshour):  We have spent some time laying out some of the basics of the exchanges and the premiums consumers might payment, but we're also getting a number of questions on other related financial issues, such as tax credits, taxes, and penalties still to come.

And that's our focus tonight.

And, once again, Julie Rovner of NPR joins us.

And, Julie, to get people to do things and not do things, there are all kinds of incentives and disincentives baked into the law.  What about these subsidies and tax credits?  How do they work?
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RAY SUAREZ:  And in a country with a median family income in the low $50,000 range, that captures most American families, that 400 percent of poverty, doesn't it?

JULIE ROVNER, National Public Radio:  Yes.  Many of the people who go to the exchanges who don't have insurance will be able to get some kind of a subsidy, some kind of help to help them pay for insurance.  In many cases, it will be possibly almost equivalent to what they would get if they had help coming from an employer.  That's the idea.

RAY SUAREZ:  All week, we have been fielding questions from people who have asked us about things they still don't understand that's in the law.  Let's take a listen.

MICHELE TORO, Florida:  I'm Michele Toro from Pembroke Pines, Florida.

And my question is, how will the tax credits affect those uninsured?

RAY SUAREZ:  Is this different if you are not working right now?

JULIE ROVNER:  No.  Basically, it's the same.

If you go to the exchange, if you are uninsured or if you buy your own insurance -- again, it's important to remember that the exchanges are not really for people who have insurance at their jobs.  It's for people who are in what we call the individual market, people who buy their insurance on their own without the help of an employer, or people who are uninsured who don't have insurance, don't have access to employer-provided insurance.

And, again, all of those people who go to the exchange will be eligible for these subsidies, these tax credits if they are between 100 percent of poverty and 400 percent of poverty, their income.