Skip to comments.IRS: Cheapest Obamacare Plan Will Be $20,000 Per Family
Posted on 01/31/2013 2:43:47 PM PST by rhema
In a final regulation issued Wednesday, the Internal Revenue Service (IRS) assumed that under Obamacare the cheapest health insurance plan available in 2016 for a family will cost $20,000 for the year.
Under Obamacare, Americans will be required to buy health insurance or pay a penalty to the IRS.
The IRS's assumption that the cheapest plan for family of five will cost $20,000 per year is found in examples the IRS gives to help people understand how to calculate the penalty they will need to pay the government if they do not buy a mandated health plan.
The annual national average bronze plan premium for a family of 5 (2 adults, 3 children) is $20,000, the regulation says.
Bronze will be the lowest tier health-insurance plan available under Obamacare--after Silver, Gold, and Platinum. Under the law, the penalty for not buying health insurance is supposed to be capped at either the annual average Bronze premium, 2.5 percent of taxable income, or $2,085.00 per family in 2016.
In the new final rules published Wednesday, IRS set in law the rules for implementing the penalty Americans must pay if they fail to obey Obamacare's mandate to buy insurance.
To help illustrate these rules, the IRS presented examples of different situations families might find themselves in.
In the examples, the IRS assumes that families of five who are uninsured would need to pay an average of $20,000 per year to purchase a Bronze plan in 2016.
Using the conditions laid out in the regulations, the IRS calculates that a family earning $120,000 per year that did not buy insurance would need to pay a "penalty" (a word the IRS still uses despite the Supreme Court ruling that it is in fact a "tax") of $2,400 in 2016.
For those wondering how clear the IRS's clarifications of this new "penalty" rule are, here is one of the actual examples the IRS gives:
Example 3. Family without minimum essential coverage.
"(i) In 2016, Taxpayers H and J are married and file a joint return. H and J have three children: K, age 21, L, age 15, and M, age 10. No member of the family has minimum essential coverage for any month in 2016. H and Js household income is $120,000. H and Js applicable filing threshold is $24,000. The annual national average bronze plan premium for a family of 5 (2 adults, 3 children) is $20,000.
"(ii) For each month in 2016, under paragraphs (b)(2)(ii) and (b)(2)(iii) of this section, the applicable dollar amount is $2,780 (($695 x 3 adults) + (($695/2) x 2 children)). Under paragraph (b)(2)(i) of this section, the flat dollar amount is $2,085 (the lesser of $2,780 and $2,085 ($695 x 3)). Under paragraph (b)(3) of this section, the excess income amount is $2,400 (($120,000 - $24,000) x 0.025). Therefore, under paragraph (b)(1) of this section, the monthly penalty amount is $200 (the greater of $173.75 ($2,085/12) or $200 ($2,400/12)).
"(iii) The sum of the monthly penalty amounts is $2,400 ($200 x 12). The sum of the monthly national average bronze plan premiums is $20,000 ($20,000/12 x 12). Therefore, under paragraph (a) of this section, the shared responsibility payment imposed on H and J for 2016 is $2,400 (the lesser of $2,400 or $20,000).
This was the plan all along, to push everyone into single payer and put the insurance companies out of business.
Women and chil’ren hurt most.
We gotta pass the bill so we can see what’s in it!...............I don’t like what I see............
The cheapest plan is about 80% if my income.
My personal health insurance alone right now is half that amount and I am not classified as a risk for anything as of the moment. I hope the 47% of the US get their just desserts.
So, the government will give a $20,000 health insurance policy to anyone who quits working?
At last the utopia of the peasantry has come to America!
With no roof over your head and no food to eat you’re going to need health care more than ever, comrade. /s
Since Median Household income is $49K, the IRS assumes that family will spend 40% of its pre-tax income on Healthcare.
I am sure this has been answered a zillion times ... So which fed govt entity gets the money from these lousy fines?
I know it all comes into treasury etc but what is their pack of lies for where the money supposedly goes? If it goes anywhere it ought to go to healthcare insurance companies so they could lower premiums (since the fine is suppoedly because people cant afford the premiums). The govt should not get a penny of it
they will get their dessert along with dinner, paid for by US. illegals will get their free healthcare also.
Do you see what page (in the attachment) the sections cited are on?
This is a can of worms.
Imagine any hospital turning away an emergency patient, whether that patient has insurance or not. Ambulance-chasing lawyers are will be on standby.
The repercussions of Obamacare will not be known for a long while. The unintended consequences will create further disasters and policy crises.
Yeah, Pelosi, someone should have read the damn thing!
If this before or after busloads of illegals arrive to get their free stuff under 0bama’s new ‘immigration’ policy?
Bingo. You are absolutely correct. These rates and declining doctor participation rates will destroy health care for the masses and they will demand that the government DO SOMETHING. Obama and his minions will then establish National Health Care after their dream of the British system. The media will report the wondrous gift from Dear Leader and suppress any bad news.
Keep working those 29 hour a week jobs, folks.
Only the top 1%, or maybe 10%, and those at the very bottom will be able to afford health insurance.
Thank God for Walmart and $4 prescriptions, at least until we need to be hospitalized some day.
Now we understand why they need 15,000 additional IRS agents to administer this convoluted mess.