Wednesday, November 06, 2013

Love and Marriage (Penalty)

Five years ago, Bob wrote about a poll which showed that "7 percent of U.S. adults married so one or the other could get on a partner's health insurance plan." The idea was that an unhealthy, uninsured person could marry someone covered by an employer-sponsored ("group") plan and be immediately added as a dependent.

But that was then, and this is now. What's changed?


The term "marriage penalty" is one that may be familiar to tax-paying married couples:

"When two individuals marry, their income tax liability as a married couple may exceed their combined income tax liabilities as singles. This additional tax burden resulting from marriage is referred to as a "marriage penalty""

Turns out, it can now also apply to health insured married couples:

"Any married couple that earns more than 400 percent of the federal poverty level—that is $62,040—for a family of two earns too much for subsidies under Obamacare."

Now, $62K isn't chicken feed, especially for a childless couple or an empty-nester (the latter of which, by the way, will now have to pay for maternity coverage). But it's also not "new car every year" wealthy, either: that translates to about $15/hour for each partner. That's a customer support gig or delivery driver; honorable jobs, to be sure, but hardly well-to-do.

On the other hand, that same couple without a pair of rings can earn up to $91,000 a year; that's $22 per hour, along the lines of a registered physical therapist or registered nurse. Both of those have great career, and money earning, potential. And that income does qualify one for a subsidy. That is, a couple making just shy of $100,000 can dig into the pockets of folks making far less to help pay for their health insurance.

What a country!
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