Category: Insurance

Healthcare Reform Update

Healthcare Reform Update

The Affordable Care Act (ACA) – also known as Obamacare – was not the perfect solution to the nation’s need for affordable healthcare, but it did increase the availability of quality, affordable healthcare for small businesses. Companies that had struggled for years – not only to find affordable health insurance for their workers but also to negotiate double-digit premium increases every year – were relieved to have choices and manageable premium rate increases.  Following Trump’s inauguration, Republican attempts to repeal the ACA without providing an alternative solution recreated the nightmare for many small firms. The administration’s ultimate failure to kill Obamacare ended up being a relief for many entrepreneurs and small business owners, but many issues remain unresolved. Healthcare Reform.

Business owners see the need for a bipartisan effort to develop realistic and affordable solutions, which would enable the small business sector to thrive and continue to fuel our nation’s economic growth. Here are some of the concerns that leaders have identified:

  • A recent report from the Congressional Budget Office on the fiscal impact of the Federal government yanking the cost-sharing subsidies that support the ACA marketplaces (a revision that would most likely occur if Republicans continue to gut the ACA) suggests that insurance premiums for small businesses would increase an average of 20 percent next year growing to a 25 percent increase by 2020. Although the Federal government is required by current laws to pay these subsidies, President Trump has indicated he wants to stop these subsidies by any means possible as part of his mission to dismantle the ACA. The CBO has calculated that the potential economic impact on the federal deficit could be as much as $194 billion, because a move like this would require consumers to obtain additional tax credits to offset their premium payments.
  • The elimination of cost-sharing subsidies would likely lead many insurance companies to exit the individual insurance market, and could disrupt the health insurance marketplace and leave small business owners with limited access to affordable health insurance options.
  • Small business advocates oppose the introduction of any measures that would result in separate risk pools for the healthy and the sick, and want to see measures to encourage businesses to establish association health plans.
  • Sector leaders want to see steps taken to expand Medicaid. ACA already had provided coverage to an additional 14 million previously uninsured Americans – a total that includes an estimated 2 million small business employees.
  • Entrepreneurs want to see healthcare tax equity measures in place for the self-employed to allow them to deduct healthcare expenses from FICA tax obligations.

The small business segment is hailed as the champion of job-creation in the United States. If it is to continue in this vital role, lawmakers must expand efforts to do more to reform healthcare insurance.

Chart Explains How Health Care Law Affects You

Chart Explains How the Health Care Law Affects You

As you prepare to file your 2016 tax return, review this chart to see how the health care law affects you.

IF YOU… THEN YOU…
 

Are a U.S. citizen or a non-U.S. citizen living in the United States

  

Must have qualifying health care coverage, qualify for a health coverage exemption, or make a payment when you file your income tax return.
 

Had coverage or an employer offered coverage to you in the previous year

 

 Will receive one or more of the following forms;

This information will help you complete your tax return.
Had health coverage through an employer or under a government program – such as Medicare, Medicaid and coverage for veterans – for the entire year Just have to check the full-year coverage box on your Form 1040 series return and do not have to read any further.
Did not have coverage for any month of the year Should check the instructions to Form 8965, Health Coverage Exemptions, to see if you are eligible for an exemption.
Were eligible for an exemption from coverage for a month Must claim the exemption or report an exemption already obtained from the Marketplace by completing Form 8965, Health Coverage Exemptions, and submitting it with your tax return.
Did not have coverage and were not eligible for an exemption from coverage for any month of the year Are responsible for making an individual shared responsibility payment when you file your return.
Are responsible for making an individual shared responsibility payment Will report it on your tax return and make the payment with your income taxes.
Need qualifying health care coverage for the current year Can visit HealthCare.gov to find out about the dates of open and special enrollment periods for purchasing qualified health coverage.
Enroll in health insurance through the Marketplace for yourself or someone else on your tax return. Might be eligible for the premium tax credit.

 
Received the benefit of more advance payments of the premium tax credit than the amount of credit for which you qualify on your tax return Will repay the amount in excess of the credit you are allowed subject to a repayment cap.
Did not enroll in health insurance from the Marketplace for yourself or anyone else on your tax return Cannot claim the premium tax credit.

 
Are eligible for the premium tax credit Can choose when you enroll in coverage to get premium assistance sent to your insurer each month to lower your monthly payments or get all the benefit of the credit when you claim it on your tax return.
Are claiming the premium tax credit and did not benefit from advance payments of the premium tax credit Must file a tax return and IRS Form 8962, Premium Tax Credit (PTC) and claim the credit on the line labeled – Net premium tax credit.
Choose to get premium assistance when you enroll in Marketplace coverage Will have payments sent on your behalf – to your insurance provider. These payments are called advance payments of the premium tax credit.
Get the benefit of advance payments of the premium tax credit and experience a significant life change, such as a change in income or marital status Should report these changes in circumstances to your Marketplace when they happen.
Get the benefit of advance payments of the premium tax credit Will report the payments on your tax return and reconcile the amount of the payments with the amount of credit for which you are eligible.