Thursday, April 18, 2013

Captain Obvious to the white courtesy phone, please

In theory, the ObamaTax requires that, beginning next January, every American (citizen) must buy health insurance, or pay a penalty tax. The problem is that the penalty tax is rather inconsequential:

"95 Tax Penalty Begins in 2014 Yet Most Say They Are Unswayed ... The tax penalty for not purchasing health insurance will start at $95 per individual or 1 percent of household income, whichever is greater"

Less than $100 a year! Doesn't seem so onerous. But even those 1%'ers [ed: I see what you did there] might be sorely tempted to take a pass, as well. After all, you'd have to get up into some hefty figures for that 1% to come close to premium levels we'll see after the dust has settled.

Let's say you bring home $250,000 a year (not unreasonable for two professionals): that penalty tax comes to $2,500, or just over $200 a month. There is no circumstance under which one will find a family plan for anything even remotely close to that, and they're not going to be getting any subsidies to mitigate the premiums, either.

On the other end of the spectrum, those on the lowest economic rungs, who probably would qualify for subsidies, aren't going to be especially moved, either: $95 a year is just about $8 a month, How likely is it that, even with a subsidy, their premium's going to be that low?

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