It’s just a personal anecdote, but I’m seeing a large percentage increase in net price for next year, but not very much in actual dollars because of qualifying for a substantial subsidy. Think $300-400 instead of $150 for lowest silver.
Been following on Reddit a little and most of the pain seems to be people at the margins of 400% FPL who have larger family sizes than just two. Or all of the above and they need a gold plan for chronic care.
I feel that in itself 26% increase is not very indicative. If you paid $1/month in health insurance and it was bumped to $1.26/month, that’d still be the same 26% increase than if you paid $1000/month and that was increased to $1260/month.
Back on the cost of the subsidies, eligibility only hinges on MAGI, not resources available. Between tax gains harvesting, Roth IRA withdrawal and itemized deduction, you can keep your MAGI low enough to qualify for subsidies regardless of net worth. Although, I’m planning to indulge in this, that feels like a loophole to have people like myself with 7-8 digit in tax-deferred/tax-exempt savings qualify for any of these. So I feel means-testing could be improved to reduce the cost.
But down the line, I don’t mind people no longer get as insulated from their healthcare costs as before the enhanced subsidies. No incentive to seek reform otherwise or to take preventive actions to lower their costs.
yeah, I absolutely dig it, but I don’t think it was the intent of either the Democrats or the Republicans for me to have received close to 200K in free health insurance since inception of the program.
I can see why they did it though. The asset test is substantially more complicated to administer.
I do wonder how many people actually have substantial assets and claim the full subsidy though. It’s got to be pretty rare.
My current plan’s premium for next year is going up from $515 to $698, or 35%. My net premium after subsidy is going up from $224 to $434, almost 100%, using the same projected income number from last year.
Ignoring the percentages, I consider an additional ~$200 per month to be pretty significant, not “not very much”…
That’s definitely an obstacle to implementation. There are not too many systems that look into total assets. ACA basically mirrored IRMAA reliance on MAGI because it’s simplest to verify.
As far as people with assets, probably more in the FIRE community but nationally there’s probably a limited fraction of the whole population who have large enough taxable accounts from which they can tax gain harvest, muni bonds, cash reserves and/or Roth IRA savings to support themselves for more than 5-10 years.
Maybe they could have considered a system like Medicaid uses to verify assets in checking/saving/non-retirement investment accounts in addition to MAGI along with long look-back periods and hefty penalties to increase compliance. But all that also costs money to implement and supervise vs. simply looking up someone’s MAGI on their tax returns.