The media has been too eager to pass along the woe-is-me stories planted by the local medical societies—the kind that say Doctor X will stop delivering babies or Doctor Y will turn away Medicare patients if the scheduled cuts in Medicare payments go into effect. Coverage of the latest doctor fix has been thin, and so has coverage of the latest money swap to fix the 1099 problem.
The House plans to debate the 1099 fix next week. Paying for subsidies for the uninsured has become a saga of “robbing Peter to pay Paul,” and the public needs to know that. Some explainers are in order.
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"As Jost points out, this arrangement, called a clawback, could spark a backlash. Who will buy insurance if they fear that a large repayment might be hanging over their heads?"
The gov't will be thrilled if people don't buy insurance b/c the tax penalty money is needed to pay for this scheme which takes complete control of your finances, income and access to health care (good luck with the latter b/c the cheapest gov't approved coverage will leave people underinsured - the actuarial values of the plans that will be offered at the Exchange tell this story).
The penalties are built into the budget for this cluster-boink just as they were in the MA plan which is the model for Obamacare. The fines for businesses in MA that did not comply were also part of the funding although these fines were/are considerably less than the individual mandate which is enforced by the state income tax department (MA D.O.R.) while the fines are not. You see, a gov't can't pull off a scheme like the MA plan or Obamacare without business support, hence, the low fines for businesses and no heavy-handed enforcement. Fear of ERISSA challenges could also play a role in this.
Here's one form of backlash once people get smacked in the face with this horror and realize they've been scammed: they will intentionally lower their incomes in order to survive this set up by quitting a part time job or taking in less work - either to get into a cheaper plan or face a cheaper penalty. (The plans in MA are not affordable for most including the subsidized ones).
Why bother earning extra money only to pay it out in penalties or to pay back the gov't when you need it to pay the bills and buy food?
I run into people everyday who are still uninsured in MA because the plan the state gov't decided they could afford is not affordable OR they don't want to be subject to the federally-required estate recovery program which has been left rather open-ended for those in the subsidized plans that are run through MassHealth (Medicaid) OR they don't do coercion OR they refuse to do business with health insurance company leeches.
Both the MA plan and Obamacare are totally regressive and oppressive. The MA plan is not sustainable although MA Gov. Deval Patrick attempts to keep it propped up to the detriment of the state budget, a 1.25 percent increase in the state sales tax, several sets of 9c cuts and severe budget cuts to safety net hospitals which in turn have caused layoffs over the past several years. And now there are plans afoot disguised as "cutting health care costs" which are going to hurt the very people the gov't claims it is helping.
Needless to say, insurers in MA are delighted with this corporate welfare scheme but residents are not. That's why Scott Brown won - he was the 41st vote to filibuster Obamacare until Pelosi rammed it through using reconciliation, thereby giving MA voters the middle finger.
What Trudy has explained in her article epitomizes the utter disrespect of the U.S. gov't toward its working class and low-income citizens. Are the halls of Congress filled with sociopaths?
#1 Posted by disgusted American, CJR on Sat 26 Feb 2011 at 03:34 AM
Yea, the payments for policies go to the insurance companies and the payments for penalties got to the government as unearned income. No wonder the politicians prefer penalties. It gives them cash they can spread around to their contributors.
I'm hoping the Republicans win the first round; either through defunding of ObamaCare or through the courts. Kill it dead. And then let's install HR676 and do it right. We all pay for health care anyway, if only at the cash register when employers add their costs to the price of their products. Let's do it correctly.
But this issue shows that virtually NOTHING good will happen without first passing public funding of campaigns. While HR676 will help the sick, the Fair Elections Now Act will help both them and the rest of us.
--
Jack Lohman
jelohman@gmail.com
http://MoneyedPoliticians.net
http://SinglePayer.info
>>> "America will always do the right thing, but only after everything else fails." Winston Churchill
#2 Posted by Jack Lohman, CJR on Sat 26 Feb 2011 at 08:03 AM
In your article you mentioned this in a parentheses: The government pays the insurer on behalf of anyone getting a subsidy.
Yes, indeed. As per Section 1402 of the Affordable Care Act The federal government will make "periodic and timely payments" to the health insurance companies which have customers who qualify for subsidies (so-called "reduced cost-sharing"). And how will the HHS Secretary and staff know who qualifies? The IRS will transmit our personal tax reporting, as necessary, to HHS.
http://www.mforall.org/p/1095
But the taxpayer, as your article highlights, will be responsible for paying the IRS any over-payment.
Wow. That bears to be repeated.
1 --- Money goes to health insurance company, the insurer, not to the insured.
2 --- If too much money was paid to the insurer, then the insured is the one who must pay back the government at tax time.
Please help me, everyone: did I miss something here?
If I didn't, then this has to be one of the most amazing positive situations for the health insurance companies and negative for Americans and America.
Somebody confirm that I am correct or set me straight. If the situation is the former, then I quote Bill Moyers: I am not making this up!
Bob the Health and Health Care Advocate
mforall.org/p/200
#3 Posted by Bob Haiducek, Bob the Health and Health Care Advocate, CJR on Sat 26 Feb 2011 at 11:08 AM
Bob,
You got it. This law was written by the insurance companies for the insurance companies and given the Gold Seal of Approval by Congress which is beholden to its money masters, the insurance companies. Oh, and let's not forget Obama who took in close to two million according to a chart I saw. (Not that Republicans don't dine at the same trough.)
This law has NOTHING do to with access to affordable care. It is merely a ploy to put more burden on those who can least afford it in order to make more money for the corporations and Wall St. - or am I being redundant?
Was talking with a friend this morning who will be assessed by the MA Dept. of Revenue with a tax penalty for being uninsured during several months of 2010, and she was quite agitated b/c she and her husband should not be facing a penalty. Here's why, and this is another heads up as to how this scheme doesn't work for you, but is a winner for the gov't and insurers:
She and hubby applied during 2010 for Commonwealth Care (subsidized plans in MA) and got run around in circles during the application process which ate into the 63 days a MA resident can go without insurance and not be penalized. They are both self-employed, and their current year income was considerably less than the prior year, so they couldn't afford the premium the gov't decided they could afford based on prior year income. They were told by one of the outreach agencies that they could submit a P & L for the most recent three months of income or for the current year to date. They did this and were finally assigned a subsidized plan based on current year income.
However, this P & L business is not always accepted. In 2008, when I called MassHealth (Medicaid which runs the subsidized plans in MA), I was told by a supervisor that a P & L is not acceptable b/c "we don't have time to bother with this." But an outreach agency will submit a P & L and hope for the best. Sometimes it is accepted, sometimes not. Catch as catch can.
So after all the delay and futzing with this couple running here and there to get coverage, the 63-day time-period passed - to the state's advantage. Now this couple will have to pay a penalty which the state is all too happy to take via the Dept. of Revenue b/c funding for the unsustainable MA plan is sorely needed. And if they appeal the penalty, the burden of proof is on them.
To add insult to injury, my friend sent a check for the first month premium for the couple and was notified that two separate checks must be sent - one for her and one for hubby - and each must be sent in a separate envelope. So hubby was arbitrarily chosen, and she remained uninsured, thereby, adding to the penalty.
This boils down to the ability that the gov't has to control the incoming penalty funding and the outgoing subsidies. And what happened to my friends is just one example of how it's done. Others in the subsidized plans find that their coverage has been terminated and have no idea why. After countless frustrating hours on phone calls or with outreach agencies, it is traced to an "administrative error." (Yea, right.) So more penalty money has been garnered by the state, less money has been paid out in subsidies, AND here's another win-win for the state: last I knew, coverage in the subsidized plans is not retroactive due to administrative errors, so the state saves even more money! I read some letters about two years ago sent to the MA Connector written by a law group that represents low-income MA residents regarding the lack of retroactive coverage. I would be surprised if this has changed. MInd you, this is not necessarily due to the inefficiency of gov't bureaucracy. It's a method of capping enrollment back-door style.
People in this country are in for a real shock in 2014, Obama and Democrat apologists included. This law must be repealed or not funded even if Republicans don't have a decent solution.
#4 Posted by disgusted american, CJR on Sat 26 Feb 2011 at 04:58 PM