Tags: kaiser | obamacare | cost | afford

Kaiser Foundation: Obamacare Not Affordable for Middle Class Families

Saturday, 08 Feb 2014 02:01 PM

By Sandy Fitzgerald

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Even with subsidies, the cost of Obamacare may be out of reach for many middle-class Americans, warns the Kaiser Family Foundation.

Three million people who earn three to four times the federal poverty rate may have to pay up to 9.5 percent of their income toward health premiums before government subsidies kick in, according to a Kaiser report published by USA Today.

The cost could mean a family of three earning $58,590 to $78,120 may be required to pay as much as $600 a month for Obamacare, and could decide health insurance is just too expensive.

As a result, middle-class families could opt to pay a penalty instead of buying coverage. That could spell trouble for Obamacare because it could leave insurers without enough healthy enrollees to offset the costs incurred by sick ones, warns Kaiser.

Consumers have until the end of March to buy coverage in the online marketplace exchanges, but some families have already started making their decisions.

Half of America's families spent 3.1 percent or less of their income on healthcare before Obamacare took effect, according to a study cited by Kaiser. People who have job-based coverage generally spend less.

But a quarter of households spent 8.2 percent or more of their income on healthcare, including premiums and out-of-pocket costs, and are likely to fall further into medical benefits.

The health law subsidies help lower-income Americans the most. People who earn up to $23,000 yearly for individuals and up to $39,000 for a family of three must pay 2 percent to 6 percent of their income toward monthly premiums.

That goes up to 8 percent for families earning two to three times the poverty rate. People earning more than that, less than 16 percent of all consumers, must pay the highest percentage of their incomes.

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