By “hurdle,” one presumes the Washington Post means “another example of Obama administration incompetence that no one discovered until the law got implemented.” Hey, po-tay-to, po-tah-to, right? Blame Congress for this one too, because they roped the IRS into the ObamaCare scheme without specifying the way the law should be applied, leaving that to Treasury to figure out. And that’s worked as well as everything else in ObamaCare has, evidently:
In May 2012, when the Internal Revenue Service proposed its rules for Americans to get government subsidies for health insurance, officials acknowledged that a legal quirk needed to be fixed: The Affordable Care Act was written in a way that inadvertently denied such help to some people who live apart from spouses who abuse them, are in prison or are on the cusp of a divorce.
The problem is that the law’s authors, in creating tax credits to help pay for health plans bought through the new insurance marketplaces, had overlooked the fact that some married people file their tax returns separately.
The IRS said in the preamble to those 2012 rules that it would correct the mistake, yet in the nearly two years since then, the Treasury Department has not made the change. And battered spouses have become the leading edge of a small army of people — legally married but filing taxes on their own — stepping up pressure to get an equal chance at affordable health plans.
How will Treasury deal with this issue? In the same ad hoc manner that the rest of the administration has so far — by ignoring laws and regulation in order to avoid the embarrassment of incompetent management:
As the first open-enrollment period for the new federal and state insurance marketplaces approaches its March 31 deadline, the Treasury Department is preparing to take steps this week to allow married survivors of domestic abuse to claim subsidies for health plans, no matter how they file their taxes, according to a department official who spoke on the condition of anonymity because the decision is not yet public. Others who are married but filing separately will not get relief for now.
Why didn’t the Obama administration act to fix this problem earlier? They’ve known about it for two years. They should have realized the issue when the exchanges went on line nearly six months ago, too. With a week to go before the deadline for coverage, suddenly the IRS is reacting to the issue, as well as those involving legal immigrants and — I’m not making this up — families with twins, which the exchange is incapable of properly handling.
Don’t ask Treasury. When the Post’s Amy Goldstein inquired as to what happened, all Treasury told her was that they “take seriously” the issue of abused spouses unable to access ObamaCare because they file separately — a tax status that has been around for decades. For everyone else using that status for whatever reason, Treasury plans to “explore ways to address the situation.” When exactly they plan to do so is a mystery, as is how the system got built without figuring out that all tax filing statuses needed to be addressed, or how the Obama administration missed that some families have twins.
More importantly, though, enrollment data shows a troubling low number of MNsure enrollees ages 26-34 are buying insurance. Estimates are that 40 percent of enrollees need to be in that demographic to provide baseline ACA funding. As of Wednesday, only about 20,400 (16 percent) were ages 26-34, well short of the ideal goal of 54,000.
Gee, why haven’t more younger and healthier consumers bothered to sign up? The St. Cloud Times editorial board might have answered its own question:
Fee. Tax. Penalty. Fine. Individual mandate. Individual responsibility payment. Whatever the label, here’s what the ACA’s website, healthcare.gov, says those folks can expect to fork over via their 2014 tax filings. Pay the greater of these two formulas:
• $95 per adult and $47.50 per child. The maximum penalty per family using this method is $285.
• 1 percent of yearly household income.
Please note, that’s in addition to paying 100 percent of your health care bills — which the government estimates to be at least $3,000 a household for out-of-pocket costs this year. Suffer any major health crisis and watch the tab you must pay in full double, triple or worse.
The problem? Most of the plans that these younger consumers can afford come with deductibles that far exceed the $3,000 out-of-pocket per household estimate, which sounds fantastically high in the first place, especially for that demographic. They will have to pay those deductible costs plus the premiums, which will also run in the thousands of dollars, before they see a single dollar in benefits. That’s why most of that demographic got catastrophic insurance coverage … before ObamaCare took that choice away from them.