Explain the Individual Mandate included in the Patient Protection and ACA and in

Question

Explain the Individual Mandate included in the Patient Protection and ACA and include the tax penalties that will be imposed if a person or a family does not obtain qualifying health coverage.

Determine who will qualify and what premium and cost-sharing subsidies will be available to individuals.

Research the income levels of individuals in your state by reviewing information available on the website www.census.gov. How do you think the Individual Mandate will affect the citizens and legal residents in your state?

If you were required to make one policy change or enhancement to ensure success of the Individual Mandate included in the Patient Protection and ACA, what would you recommend?

Explanation / Answer

Individual mandate

            The Patient Protection and the Affordable Care Act require all U.S. citizens and legal residents to obtain a health insurance. Individuals can obtain coverage through American Health Benefit Exchange available in all states. Families with less income can benefit from premiums and cost sharing credits. Employers are required to pay employees penalties for obtaining tax credits via an exchange.

Individual mandate and tax penalties imposed:

            The individual mandate requires both the citizens and residents to obtain a health coverage that is qualifying. Those who lack to obtain health coverage are given a tax penalty of $695 yearly which will amount to 2.5% household income. The individual mandate states that the year 2016 there will be increase in penalty annually due to the adjustments of the cost of living.(Clement, 2012). However financial hardship objections from religion exemptions will be granted. American Indians, immigrants who are undocumented, individuals who are incarcerated and those who do not obtain coverage for less than three months will be exempted from thetax penalty.

Cost sharing and premiums available to individuals:

            Cost sharing subsidies and premium credit will be offered to Legal immigrants and citizens manage to meet income limits. However employers whose coverage is offered by their employers cannot qualify for premium credits if the employer has at least 60% actuarial value. On the other hand, legal immigrants who for five years in the U.S. were barred from participating in Medicaid can obtain premium credits.( Basu et al, 2014)

            Refundable premium credits will be offered to individuals and families whose incomes is between 100 -400% to help them obtain insurance via exchanges. Individuals receiving annually subsidies will have an increase in premium contribution to help reflect on the premium growth excess over the income growth rate for 2014-2018.

            Citizenship status and income are the individual’s determinants of acquiring cost sharing subsidies. The cost sharing subsidies cannot be used to obtain abortion coverage. In case of an individual purchases an abortion coverage using the subsidies, the funds should be segregated from state funds.

The effects of the individual mandate on citizens and legal residents in my state:
            The individual mandate will have both positive and negative effects on the citizens and legal residents in my state.

Positive effects:

            The middle families will experience a reduction in insurance premiums and most of them will manage to access coverage. Insurance will be affordable to low income earners in my state as the individual mandate provides subsidies and premiums via exchanges. The citizens and legal residents working for big employers in my state will also access coverage through the employers insuring them. The women will also benefit from the individual mandate by accessing women health services. Citizens who own small businesses will benefit from tax credits making it easier for them to insure their employees. The citizens will benefit from improved Medicare benefiting both low and high incomers the state. The individual mandate provides the residents and the citizens with more options on private coverage which they may benefit from. The health care reform hasmeasures to help curb cost thus making the spending on health care grow at the slowest rate. The health care reform will enable the low income earners to benefit from Medicaid expansion.(McDonough & Adashi, 2014). The individual mandate has made it possible for the citizens to enjoy preventive and wellness services. The individual mandate has also protected the citizens by coming up with consumer protections, where the insurance companies are forced to spend    80% of their income or return the unspentincome to customers. In addition there has been creation of boards and agencies to ensure that the individual mandate is achieved, this will help to ensure that the citizens benefit and receive the services as outlined in the individual mandate law.

Negative effects:

            The citizens and the legal residents who fail to obtain coverage will receive a tax penalty; the tax penalty imposed may be a bit higher for the low incomers to meet given their income levels. The individual mandate will have negative effect on the big businesses as it requires them to pay high taxes to help finance reform on the health care.(Lapitak, 2012). In order to ensure that the program works the citizens may be required to fund the program hence increases in cost. The individual mandate may lead to lack of employment for some citizens due to business owners employing fewer employees to cut on the costs of buying employee insurance. The citizens that do not meet the cost assistance limit will be forced to find ways of obtaining coverage which may be hard to afford.

            The workers earning low wages but are covered by their employers fail to get cost assistance therefore, they may be forced to get a coverage for their dependents as they are not covered by the employer coverage. Despite the funding from the federal the residents and the citizens may be faced with the challenge of the state opting out from the coverage hence not benefiting.

Policy change:

            In my view the policy change that would need to be enacted is coming up with a committee that is qualified and effective on overseeing the individual mandate is effective in every state. This would help make the individual mandate a success and also ensure that every individual understands and has obtained coverage. The committee should also see to it that the employers cover their employees. In order to achieve this committee should be competent, strict and corruption free.

            In conclusion, the pros of the individual mandate outweigh the cons. Therefore the citizens and the resident s should focus more on the pros and contribute to the success of the individual mandate. It is evident that the individual mandate has put into considerations to all the income levels by providing subsidies and premiums therefore the Americans should see to it that they benefit.

References

Basu, A., Coe, N. B., Grembowski, D. E., & Kessler, L. (2014). Political Polarization, Anticipated Health Insurance Uptake and Individual Mandate: A view from the Washington State (No. w20655). National Bureau of Economic Research.

Clement, P. (2012). Patient Protection and Affordable Care Act and the Breadth and Depth of Federal Power, The. Harv. JL & Pub. Pol'y, 35, 933.

McDonough, J. E., & Adashi, E. Y. (2014). Realizing the promise of the Affordable Care Act—January 1, 2014. JAMA, 311(6), 569-570.

Liptak, A. (2012). Supreme Court upholds health care law, 5-4, in victory for Obama. The New York Times, 28.

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