This went up yesterday, at the main site. It’s a link to the Kaiser Family Foundation’s rather comprehensive cost calculator, to determine what your cost for a Marketplace policy (formerly “Exchange policy”) would be, after the government credits you the Affordable Care Act credit.
Here’s what you need to know:
For most Americans buying in the Marketplace, the price is going to be a NET price. (Net meaning total cost less tax credit.) In effect, the Affordable Care Act is a surtax for health insurance, just like Medicare, and just like how most countries do it. If you pay income tax, you are already paying for other people’s health insurance, and have been for years and years. Now, you also pay toward your OWN insurance.
The general headlines that say the cost is “8%” or “9.5%” are really simplified. The fact is, it will be a number between 2% and 9.5%, and the “phase-in” range will involve steeper marginal rates, like 11% or 15%. If you smoke, the gross premium can be up to 50% higher, but the federal credit will only be calculated on the non-smoker rate.
There will be planning opportunities, as regular readers (and clients) of mine already know. It will benefit you to know which moves help to keep get your income to a level that allows you to take advantage of the tax law changes.