Changes to Obamacare in 2016

The new article Get Ready, Because Big Changes Are Coming to Obamacare in 2016 published by The Motley Fool presents three big changes to Obamacare in 2016:

1. Changes to Obamacare in 2016: The minimum penalty for individual mandate non-compliance is going up a lot

“Taxpayers who didn’t have health insurance in 2014 and who didn’t qualify for one of more than a dozen exemptions were required to pay the greater of $95 or 1% of their modified adjusted gross income, or MAGI. In 2015 this penalty rose to the greater of $325 or 2% of MAGI. Next year consumers who choose not to purchase health insurance can expect a penalty that’s the greater of $695 or 2.5% of MAGI. For a family the penalty could top out at $2,085! Beyond 2016 the minimum penalty will increase in line with the rate of inflation”.

2.Changes to Obamacare in 2016: The employer mandate will go into full effect

“Under the employer mandate, businesses must provide their full-time employees (and their children up to age 26) health coverage options, and ensure that those options cover at least 60% of total allowed medical costs. In addition, if the cost of healthcare premiums exceeds 9.5% of a full-time employees’ MAGI, then the business is responsible for providing a subsidy to cover the difference. Fail to comply with these new rules and businesses could be looking at some very steep fines that range between $2,000 and $3,000 per full-time employee, or FTE.

In 2015, big businesses with 100 or more FTE were edged into the employer mandate, with employers required to offer at least 70% of their FTEs health insurance coverage. In 2016 and beyond, businesses with 100 or more FTE will need to boost their coverage to 95% or more. Mid-sized businesses of 50 to 99 FTEs will also be required to offer coverage to 95% of qualifying employees after being exempt from the penalty in 2015. Businesses with 49 or fewer full-time employees will still be exempt from Obamacare penalties, as are part-time employees, defined as working 29 or fewer hours per week.”

3.Changes to Obamacare in 2016: Insurers are set to enact their largest premium rate hikes since Obamacare went into effect

“According to data compiled by the Washington Examiner, which took a closer look at 37 states and Washington D.C., the number of policies with double-digit rate increase requests nearly doubled to 231 in 2016 from 121 requests in 2015. Further, in 2016, 126 plans are requesting premium jumps of at least 20%, 61 plans are asking for a 30% hike, 26 policies are seeking as much as a 40% jump, and a dozen plans are after a 50% (or higher) hike. In 2015 we only witnessed 21 requests for a 20% hike, just nine requests for a 30% hike, and not a single request of 40% or beyond.

In other words, 2016 looks like it could be the first year where we discover just how affordable the Affordable Care Act really is. One of the prevailing fears among insurers and medical care providers, such as hospitals and primary care physicians, is that consumers will be so strained by the cost of premiums that they may not be able to afford the out-of-pocket deductibles required when heading to a doctor.”

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