What will h b 3200 cost me?

This is part 3 of my coverage of the health bill. The House Energy and Commerce Committee has submitted something new but I haven't found that yet.

What will it cost each of us?

As a point of reference, the average cost of a plan provided by the employer in 2008 was approximately $12,700 for family and $4,704 for single coverage. Employers get the best deal from insurance companies because of the expanded risk pool. So let's assume that every family will have to pay $12,000 (a nice round number) in this gov't required plan. That's just the premium.

Good news!!! You may have a credit available to reduce that premium (page 137). If your income in terms of the FPL is $88,200 (family of 4), then you only pay $9,720 per year. In addition, your cost-sharing portion is 30%. As near as I can tell, the law means that after your initial deductible ($10,000) you must pay 30% of all covered healthcare services that you receive. Of course, in Part 2 of this discussion I mentioned that there are some health care items which must be free to you.

If your income is $66,150, then you pay $7,277 and your cost-sharing rate is 28%.

I use the $12,000 arbitrarily because if employers can get the best deal, then a gov't controlled environment would get at least that. However, nowhere in h b 3200 is a premium stated. It only mentions that the Secretary of HHS will determine premiums.

If your income is over $88,200, then you get no premium reduction. You pay the full $12,000 and your cost-sharing is 30%.

Let's try and example for your income over $88,200. Your family has been healthy all year. One child is hospitalized and released after 5 days. Assume total health care charges are $50,000. Your portion is $10,000 (the deductible) plus 30% X (50,000 - 10,000). That's a total of $22,000. Add that to your premium and your total cost is $32,000. In part 2 I mentioned medical bankrupcties, so get in line.

Let's assume all ins. co. will jump on this band wagon and you choose a policy from one and it is a Qualified Health Benefits Plan. It is possible that it later fails to qualify. If so, you may be penalized (not taxed) at the rate of 2.5% of your AGI - $26,000 (family of four). Less than $26,000 and you are not required to file a return and therefore will not be penalized. You can't cheat by covering only the adults and not the children. The penalty still applies.

If you are obstinate, and refuse any insurance, the penalty still applies. They will catch you. You know how your income is reported on W-2s and other forms. There will be reporting forms for insurance coverage. There will be a knock at your door and ..."I'm here from the government and I'm going to sign you up."