Skip to comments.The Dishonor System - A user’s guide to committing fraud on the Obamacare exchanges
Posted on 07/31/2013 8:14:16 PM PDT by upchuck
Let me stipulate that I do not condone fraud in any form. Moreover, I assume all Weekly Standard readers are law-abiding citizens who would neither commit fraud themselves nor encourage others to do so. My purpose is to inform such readers just how tempting fraud on the Obamacare health insurance exchanges will be in light of the recently announced delays in employer reporting and employer mandates.
There are three types of fraud worth considering, each reflecting different motivations and degrees of risk tolerance among the hypothetical individuals considered.
Low-income, full-time worker in a large firm offering health coverage.
Mikes situation: Lets start with Mistreated Mike, a $14.00-per-hour janitor in a 200-person law firm already offering health coverage. He works 40 hours a week, 50 weeks a year, making his total wage income $28,000. At 116 percent of the federal poverty level, its tough to provide for his stay-at-home spouse caring for two toddlers, but he gets $6,026 in Earned Income Tax Credit (EITC) that helps out. Mikes proud that hes managed to provide health insurance for his family for years, but its expensive. For 2014, hes selected the most affordable plan his company offers, but hes crossing his fingers that his familys out-of-pocket spending wont reach the average level expected for those who select such a plan: $5,000. Mikes employer pays much of the $14,100 family premium and fortunately has set up a Section 125 plan so that every penny of Mikes $3,241 contribution is tax-deductible. Still, thats a hefty 11.6 percent of his wage income, which might make it appear that Mikes coverage meets Obama-cares definition of unaffordable. In that case, he would qualify for subsidized coverage on the exchange. Unfortunately, exchange eligibility is restricted to those whose cost for self-only coverage under their employer plan exceeds 9.5 percent of household income, and Mike has family coverage. Since Mikes share of a self-only premium would be only 4.9 percent of his income, he is not legally permitted to buy subsidized coverage through the exchange.
But Mike realizes that he is, in effect, also paying the employers share of his premium in reduced wages. How? He has a twin brother doing the same work as a janitor for a neighboring law firm of the same size. However, because that firm consists only of a few high-paid partners and associates, along with an army of paralegals and legal assistants, it has decided to drop its health benefits in 2014. To replace the lost benefit, the company has already announced it will instead pay his brother about $8,000 more a year to do the identical job.
Mikes motivation: Heres what frosts Mike. His brother will get not only a much higher cash wage in 2014, but also a Silver health plan comparable to Mikes, paid for with $15,616 worth of taxpayer-financed exchange subsidies! (A Silver plan, under the Affordable Care Act, covers 70 percent of a typical plan members expenses. In addition to the subsidy to pay the premium, someone at the income level of Mikes brother will also receive a cost-sharing subsidy to raise the coverage from 70 to 94 percent of his health spending.) After deducting all taxes and health expenses, Mikes net income is expected to be $26,884, whereas his brothers will be $33,350. Mike does not live in one of the 24 states moving forward with Medicaid expansion, so his only prospect for subsidized coverage is through the exchange. In short, Mike can boost his cash income considerably if he can get exchange-subsidized coverage.
The way Mike sees it, Uncle Sam is levying a substantial tax on him simply for working for a large employer that responsibly offers health benefits. How is that fair? Mike appreciates that by not taxing his health benefits Uncle Sam is giving him roughly a 10 percent discount on all his health spending. He just cant figure out why his brother is getting an 82 percent discount, especially now that his brothers wages are substantially higher than Mikes.
There's lots more at the link.
Pardon me, the popcorn is done.
The popcorn is burned...
Makes ya sick, don’t it.
1) best to just get married south of the border, where the marriage license is not transferred to the US (unless you apply for it to be transferred).
2) Then claim you are single supporting your kids. best part is, BOTH parents get to claim they are single. Then, get a job that pays cash, so you can claim you have no income!
There is no way any individual can wade their way through this quagmire.
He (obama) has effectively blown up everything we thought we understood about our healthcare.
I’ve been paying for it and used very little. Now I must pay more so others who don’t work can get in line before me or my covered loved ones who have to arrange an appointment and use leave to do so.
Last time I went to the urgent care clinic with an actual injury I was in line with people who didnt speak english.
I been workin my whole life and paying taxes.
Since I’m an old fart I get to take advantage of Medicare which I do on a regular basis.
I play a game with the Medicare B supplement, tracking what they pay for me and what I pay them. So far this year they are up by $388. Good for them :)
Next year should be interesting. I expect the supplement premium to double.
I did not know that.
It sounds like the dems are out to make health care fraud as common place and acceptable as vote fraud.
That's clever. Since liberals approve of stealing (which they call redistributing the wealth) and we disapprove, they are writing laws that only support their voters.
Don’t forget to register under different names. Juan Hernandez Rodriguez can be two people, and so can his baby mama. That’s four checks coming in instead of one.
Then keep collecting at different addresses as you move or change partners.
Pretty soon you’ll have an Escalade, bling, hair treatments, etc.
I am married with 4 kids. Make enough that I pay taxes. She is a stay at home mom. I have considered getting a paperwork divorce from the wife. This way she can collect welfare and food stamps for her and the kids. The kids will also get free medical care through the state, back to school clothing vouchers, free lunches and so on. I figure we can increase our income by $20,000.
I ask myself everyday why bother going to work anymore.
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