That’s the title of Subtitle E.
And, because this is the Federal Government, affordable coverage choices start with taxes and subsidies. This shouldn’t surprise anyone that has taken any economics, as the primary tool of a government has to affect actions in the economy is through taxes and spending.
This particular section – 1401 – discusses a tax credit, given against a tax, for premium assistance. What the heck?!?
First – this implies that there is premium assistance for those who are unable to afford their health insurance premiums. And there is. Since insurance is mandated, the Act recognizes that not all people will be able to afford the premiums, so it gives some people money back. This applies if your household makes over 133% of the poverty level. If it makes less – you are probably (at least under the Act) eligible for Medicaid. There is some chance that your particular state will decide not to expand Medicaid coverage to people who make between 100% and 133% of the poverty line, or who don’t have dependent children. If your state doesn’t expand this coverage, I suggest you think about why, and possibly, how to move to state that does.
The premiums in the Exchanges, which are what the rebates are for, are also related to the color of the plan (remember the colors of the plans back in this post?) – with the amounts tied into the second lowest cost for a silver plan. Confused yet?
If you choose to buy insurance from your employer, rather than through an Exchange, and that health care is deemed to be meeting the essential minimal coverage guidelines, and to be affordable, or you receive health care under a free choice voucher (a later section) then you aren’t eligible for the premium assistance. It is up to you to decide if your health insurance would be cheaper through your employer, or through an Exchange.
So – because you received money, that’s considered income. To avoid having people taxed on this “income” the IRS gives you a tax credit. That’s the Feds for you – if there is a complicated way to do something – that’s what they choose.
There are provisions in this section to review this tax credit, and the insurance plans in general, after 5 years, to see if it met the purported goals of increasing health insurance coverage without being too burdensome on the populous. If the history of the US is any indication, it will be unlikely that a tax credit will get eliminated, but it’s possible.
You might be asking yourself, why all of this complicated tax credit, premium assistance, etc, is part of a Reform Act intended to make getting health care easier? Well – that’s because it isn’t precisely intended to make getting health care easier. If that were the goal, it would have set up a single payer system. Single payer systems, which have been referred to as socialist, the work of the devil, and sensible, are present in the US, but only if you are old, or a veteran. Otherwise, you get insurance. So the PPACA is there to make getting insurance easier. It’s also good, if you like the PPACA, that they picked a taxation system, rather than trying to implement a mandate strictly through the use of the Commerce Clause of the Constitution. The Opinion that supported the constitutionality of the individual mandate made it clear that they wouldn’t have done so had it not been a tax matter.