NCPA - National Center for Policy Analysis

Will the Poor Be Able to Afford Health Reform?

November 28, 2011

Discussions of the new health care overhaul to take place in 2014 often focus on the program as a whole, contesting its constitutionality or its effects on the deficit.  Individual components of the law and their consequences, while substantial, have received little attention.  Specifically, a single provision has continued largely unnoticed that would raise the cost of insurance for some low- or middle-income families, or even make it unaffordable entirely, says Diana Furchtgott-Roth, a senior fellow at the Manhattan Institute.

  • The Patient Protection and Affordable Care Act (PPACA) will extend health insurance to about 30 million of the 50 million now uninsured in the United States.
  • A recent study, however, suggests that 13 million low-income Americans may be unable to get subsidized health insurance through new state health care exchanges.

The possibility of failing to qualify for federal assistance with health care premiums stems from provisions within the legislation itself.  The Act requires those businesses with 50 employees or more to supply affordable health care coverage, yet it makes no guarantee that such plans would cover the family of the employee as well.  Furthermore, the law also states that if a family member is covered by a plan through his or her employer, the rest of the family cannot receive federal assistance for purchasing their premium, even if the employer plan is limited to the employee alone.  The end result of these provisions will be that employees will prefer to work for employers that do not affordable health insurance so that they can qualify for the subsidy.

Source: Diana Furchtgott-Roth, "Will the Poor Be Able to Afford ObamaCare?" Real Clear Markets, November 17, 2011.

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