Thursday, September 26, 2013

Obamacare: How Much It Will Cost to Get Health Insurance

By Claudio Iván Remeseira | Posted on Thursday, September 26, 2013, at 3:30 p.m. ET. Last modified: Saturday, Sept.28, at 12:33 p.m.

On October 1, when uninsured Americans begin enrolling in the health care exchanges created by the Affordable Care Act, a.k.a. Obamacare, around 95 percent of them will face premiums 16 percent lower on average than previously estimated by the Congressional Budget Office (CBO), according to a Department of Health and Human Services report released yesterday. 

The report projects the average nationwide price of basic coverage in $249 a month, excluding tax credits.  The actual cost will depend on a person's age, family size, income, health habits (smoking, etc.), and location. In New York and New Jersey, for example, prices will range from $250 to $299 [To learn more about premium costs in each state, see infographic]

People with household income of less than four times the poverty line, or about $91,000 a year for a family of four and $46,000 for an individual, will be eligible for federal tax credits. Think Progress reports: 
In the 36 states where the federal government supports or fully runs the Health Insurance Marketplace, a 27-year old who does not qualify for tax credits will pay, on average, $163 for a plan that covers approximately 60 percent of health care expenses (a so-called bronze-level plan), while a 27-year-old with an income of $25,000 could pay $83 dollars per-month after subsidies. Individuals up to 30 years old will also have the option of buying cheaper catastrophic coverage outside of the marketplaces, though they will not qualify for subsidies. A family of four in Texas with an income of $50,000 would pay as little as “$57 per month for the lowest bronze plan after tax credits,” the report finds.
There are four levels of coverage plans, named after different colors. Bronze plans are the cheapest; they cover only 60 percent of an individual's average medical expenses. Silver plans cover up to 70 percent, Gold plans cover  80 percent, and Platinum cover 90 percent. Subsidies will also help reduce the cost of a plan. TNR's Jonathan Cohn explains:

 The law effectively tries to dictate what people will pay for the second-cheapest silver plans, no matter where they live. For a family of four with income of $50,000, the cost for such a plan in almost every city and state is $282 a month. But because of the way the subsidies work, applying those subsidies to even cheaper plans can reduce premiums even more—and at varying levels, depending on location. In Philadelphia, Pennsylvania, that family of four making $50,000 a year could get the cheapest bronze plan for $96 a month. A similar family living in the Virgina suburbs of Washington, D.C., could get one for nothing.
According to the U.S. Census Bureau, around 30 percent of Latinos are uninsured. For people like Emilia Rosa, a Salvadorian immigrant who earns $22,000 a year cleaning houses, Obamacare can be life saving; her case was featured in this Washington Post special report. Ms. Rosa has fibromyalgia, a debilitating condition that keeps her awake at night, and takes four different medicines for joint pain. Thanks to the new law, she may be eligible for a federal subsidy of $203 a month and apply it toward the premium of a moderately priced plan or of event the cheapest one, in which case her premium would be zero. “I’m waiting for October,” she told the Washington Post.

Small-business health exchanges run by the federal government will not open for online enrollment until November. But applicants may still enroll by phone, mail or fax beginning October 1. In every case, benefits will start running in January.

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