Healthcare reform.docx - Healthcare reform In this class we will consider the U.S healthcare reform of 2010 as a test case for our views about the

Healthcare reform.docx - Healthcare reform In this class we...

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Healthcare reform In this class we will consider the U.S. healthcare reform of 2010, as a “test case” for our views about the government’s responsibilities for regulating business life, as well as businesses’ broader responsibilities to society. The 2010 reform maintained the private healthcare system in the U.S., but extended public insurance for the poor (Medicaid) and the aged (Medicare), increased subsidies for low- and middle-income families, and regulated the private insurance system by mandating most citizens to have insurance, most employers to pay for it, and all insurers to follow regulations on provisions and prices. Below are the main provisions. 1 Requires most U.S. citizens and legal residents to have health insurance. Those without coverage pay a tax penalty of either $695 per year up to a maximum of three times that amount ($2,085) per family or 2.5% of taxable income, whichever is the greater. The penalty will be increased annually for cost-of-living adjustments. Exemptions will be granted for financial hardship, religious objections, American Indians, those without coverage for less than three months, undocumented immigrants, incarcerated individuals, those for whom the lowest cost plan option exceeds 8% of an individual’s income, and those with incomes below the tax filing threshold (in 2009, $9,350 for singles and $18,700 for couples). Requires employers to pay penalties for employees who receive tax credits for health insurance through an Exchange, with exceptions for small employers. Employers with 50 or more full-time employees that have at least one full- time employee receiving a premium tax credit, will pay a penalty the lesser of $3,000 for each employee receiving a premium credit or $2,000 for each full-time employee, excluding the first 30 employees from the assessment. Employers with no more than 25 employees and average annual wages of less than $50,000 that purchase health insurance for employees will be provided with a tax credit of up to 35% of the employer’s contribution toward the employee’s health insurance premium if the employer contributes at least 50% of the total premium cost. Smaller credits will be 1 Adapted from the Henry J. Kaiser Foundation, “Summary of the Affordable Care Act,” April 25, 2013.
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