Obamacare Survives Another Scare

Once again, the Affordable Care Act (AKA Obamacare) has survived a challenge to some random bit of included text. This time, by a vote of 6-3, the US Supreme Court decided that yes, it is legal to provide the tax credit for insurance premiums in all 50 states

I spend some time every year as a tax preparer for a major national chain, so I’ve seen the ACA coming for a while now. 2014 was the year Obamacare went fully into effect, so this tax season was the first time I’ve seen people who were directly affected by the act. Here’s a quick summary of what I saw this year.

First, the good. I sat across the desk from many people who have health insurance for the first time. Whether the issue was awareness, or affordability, or prior health concerns, these are the people who have been most helped by the ACA.
Now the not-so-good. The premium subsidy (formally called an Advanced Premium Tax Credit) is available to individuals and families who have lower income. That part’s still good. The not-so-good part is that your premium advanced for calendar year 2014 was based on your 2012 income as reported on your federal income tax return. So if 2014 was a better year for you income-wise than 2012 was, you may have to repay some or all of the subsidy. That came as quite a shock to some people.

And of course there’s the penalty for not having health insurance coverage for the entire year. For most of the people I saw who didn’t have health insurance, the penalty was relatively minor—under $200. But depending on your income level and family size, the penalty could be more than a thousand dollars. For 2015 the penalty more than doubles from the 2014 level, and in 2016 it’s higher yet.

Opponents of the Affordable Care Act vow to continue to fight. There’s a regular drumbeat for repeal in Congress, and who knows how many suits there are now working their way through lower courts. Still, putting it all together the effect of Obamacare has been net positive. My view is colored by the fact that I have my own health insurance through the state marketplace. It’s better insurance than I had before and it costs me less. Put me down as a fan.