Friday, January 08, 2010

Obamacare's attack on families

The news continues to be disconcerting when it comes to the impact the President's health care bill will have on average Americans and families in particular. In addition to leading to health care shortages, waiting lists, and the squeezing of individuals out of private care into the government program, this bill takes particularly harsh aim at married couples.

In fact, the Wall Street Journal is reporting that "Some married couples would pay thousands of dollars more for the same health insurance coverage as unmarried people living together, under the health insurance overhaul plan pending in Congress"

In light of the bigger issues surrounding the bill -- quality of care, concern for shortages, disruption of the patient and doctor relationship, abortion funding -- many are not noticing the economic discrimination that is taking place against people based on their marital status.

The "marriage penalty" that is being "built in" to both the House and Senate health care bills has largely gone under the radar screen, but many low-income and middle-income couples could find themselves with an increase of $2,000 or more in annual insurance premiums the moment they tie the knot.

How will this discrepancy be demonstrated between the married and singles? The Wall Street Journal article points out that "because subsidies for purchasing health insurance under the plan from congressional Democrats are pegged to federal poverty guidelines. That has the effect of limiting subsidies for married couples with a combined income, compared to if the individuals are single. People who get their health insurance through an employer wouldn't be affected.
Only people that buy subsidized insurance through new exchanges set up by the legislation stand to be impacted."

Here are the facts surrounding the House and Senate measures, according to the Journal:

  • About 17 million people would receive such subsidies in 2016 under the House plan

  • The bills limits the annual amount people making less than 400 percent of the federal poverty level must pay for health insurance premiums, ranging from 1.5 percent of income for the poorest to 11 percent at the top end
  • Under the House plan: For an unmarried couple with income of $25,000 each, combined premiums would be capped at $3,076 per year. If the couple gets married, with a combined income of $50,000, their annual premium cap jumps to $5,160 -- a "penalty" of $2,084. The "crime" that generates this penalty is simply being married

  • The difference is less in the Senate version of health care legislation, chiefly because premium subsidies in the House bill are more targeted towards low-wage earners

  • Under the Senate bill, a couple with $50,000 in combined income would pay $3,450 in annual premiums if unmarried, and $5,100 if married. This difference of $1,650 is again due to the marital status.

Critics of the plan say that married couples whose combined income makes them ineligible for subsidies is even greater -- possibly as high as $5,000 or more -- depending on the price of the insurance policy.

The obvious concerns surrounding this bill are getting a significant amount of attention. There are many less obvious stories that surround this bill that should be of equal concern to the American people.

Kevin Price is a syndicated columnist whose articles frequently appear at ChicagoSunTimes.com, Reuters.com, USAToday.com, and other national media. Kevin Price is Host of the Price of Business (M-F at 11 AM on CNN 650) and Publisher of the Houston Business Review. Hear the show live and online at PriceofBusiness.com. Visit the archive of past shows here.

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