Tags: obamacare | work | less | better

Obamacare Glitch: It Pays Off to Work Less

Tuesday, 30 Jul 2013 09:34 PM

By Todd Beamon

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink
Putting in even a little overtime could cause you to lose thousands of dollars in subsidies to buy health insurance under Obamacare, according to a new analysis.

A quirk in the Patient Protection and Affordable Care Act taking effect on Oct. 1 could cause people to cut back on their working hours to avoid losing money, according to ValuePenguin.com.

"Working more can actually leave you worse off," the price-comparison site says in a new analysis.

"It's sort of an absurd scenario," Jonathan Wu, ValuePenguin.com's co-founder, told CNBC. "It's something for people to be aware of."

Under that scenario, CNBC reports, an individual or family whose annual income surpasses maximums set by the federal government — even if it's only by $1 — will totally lose subsidies available to buy health insurance under Obamacare.

The loss of those subsidies in some cases would mean that people may well have been better off financially if they had worked less during the year, Wu said. Otherwise, they then would have to work significantly more to make up for the lost subsidy.

"They'd be surprised to see how drastic it is," Wu told CNBC. "I'd be kind of shocked to see if I make $100 less [in total income each year], I get all these benefits, but if I make $100 more, I get nothing."

"You basically don't want to fall in that hole," Wu added, noting that he believed contractors and others with more control over their incomes would most likely adjust the number of hours they worked to avoid the Obamacare "subsidy cliff."

He also said that because of lower insurance premiums often offered younger people under Obamacare, the effect will more likely be seen by older people.

But "you will see it across all age groups," particularly in the seven states — including New York and Vermont — where insurance premiums are either barred from being affected by age, or restricted from being dramatically affected, Wu told CNBC.

Under Obamacare, federal subsidies in the form of tax credits to buy insurance on new state health insurance exchanges will be available to millions of people who can start enrolling on the exchanges on Oct. 1.

The subsidies are available to people or families whose incomes total up to 400 percent above the federal poverty level, and are designed to cap their insurance premiums at 9.5 percent of their total income.


© 2014 Newsmax. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Retype Email:
Country
Zip Code:
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
You May Also Like

Pope Seeks to Bring Faith to 'Ends of the Earth'

Saturday, 19 Apr 2014 18:26 PM

Pope Francis baptized 10 people Saturday and urged them to bring their faith to the ends of the Earth as he presided o . . .

Conservatives Deride Effort to Rig Electoral College

Saturday, 19 Apr 2014 19:37 PM

Conservatives slammed the campaign to effectively end the Electoral College's role in presidential elections, saying tha . . .

Fox Executive Fired Over Flight 370 Charity Email

Saturday, 19 Apr 2014 18:22 PM

A veteran Fox executive who used her company email account to plan aid for loved ones of the missing Malaysian airplane' . . .

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved