After seeing the assignment for this week’s blog, I became quite excited about reading up on the Affordable Care Act as I have very little knowledge of its specifics. Unfortunately, I have not been motivated to really look into Obama’s proposal because it really does not have much of an effect on me in the immediate future. However, I do understand the historic importance of the act as it is probably of the largest and most contentious pieces of legislation that has been passed in my lifetime. Furthermore, I believe that it represents the first significant health care reform passed since Truman’s presidency (correct me if I am wrong). As indicated in the directions, I began my research by taking the quiz on the Act and, much to my surprise, got 6 out of 10 correct. I was slightly impressed by my results, but have to admit that I guess on about half of them.
In choosing exactly what aspect on the act that I wanted to focus on, I thought it would be prudent to start with arguably the most important part: the Individual Mandate. Ultimately, I wanted to start here because it appears to be the most controversial part of the reform and the part that is most important for it to work as planned. Now I will attempt to explain it as I understand it:
The individual mandate of the Affordable Care Act requires that all individuals purchase health care insurance or pay a penalty. This penalty is enforced on an annual basis at differing rates. Starting in 2014, adults without insurance will be forced to pay $95 or 1% of their annual income if it is greater than $95. In 2015, this fine jumps to $325 or 2% of annual income. Then, in 2016 and beyond, the fine reaches $695 or 2.5% of annual income. What’s important to note is that there are exceptions to the rule for certain situations. These situations include:
- If your religion opposes receiving health care benefits
- Undocumented immigrants
- Incarcerated individuals
- Native Americans
- If family income is below threshold for filing a tax return
- If insurance would cost more than 8% of annual income
It is also important to note what the plan qualifies as acceptable healthcare. If an individual is covered by Medicare, Medicaid, a veteran program, TRICARE, employment plan, private insurance of at least bronze level, or a grandfathered plan, then they are not required to buy insurance or pay a fine. The Henry J. Kaiser Family Foundation provides a useful diagram to explain this provision and this short video also is useful in understanding the penalties associated with not purchasing insurance.
Taking a look at the provision from a more personal and political point of view, I have some mixed feelings. For the one part, I am very much so an advocate for having a universal health care program and think that it is kind of ridiculous that a country as wealthy as the United States cannot provide all of its citizens with adequate care. On the other hand, I am a little bit troubled by the idea that the government is forcing everyone to take part in something that they don’t necessary believe in. Though I agree with the argument that issuance ultimately saves people a lot more money than paying fully for medical expenses, I still feel that people should have the right to participate or not participate in programs like this. Ultimately, it is their own money to spend so I don’t feel like the government should tell people what they have to do with it. Secondly, I am still not convinced of the argument that the act will actually make healthcare cheaper for individuals. In a New York Times blog by Casey Mulligan, he makes the case that so the millions of Americans that are currently uninsured will become insured in the next few years because it has become cheaper. However, one of his biggest arguments is the fact that the individual mandate makes it cheaper because “the penalty effectively makes insurance cheaper because people can avoid it by getting insurance.” Ultimately, I feel that this is a very roundabout argument that does not actually prove that it is cheaper than before to get insurance. Undoubtedly, this plan will place new costs on many people and so it will be interesting to see how effective the new system is to determine whether it is worth those costs.