Archive for category Health Care
What do you call it when someone is forced under threat of loss of a professional license to accept payment for services that is below the cost to deliver those services?
One of the eventual outcomes of Obamacare I predicted in back in 2009 was the federal government taking control of the supply side of the health care market equation. I predicted rationing. There is another way for the government can control supply: forced labor, also known as slavery.
I guess I never thought forced labor would be offered as a solution for government interference in the health care market, but a candidate on the Virginia ballot for the state assembly has suggested just that,
Democrat delegate candidate Kathleen Murphy said that since many doctors are not accepting medicaid and medicare patients, she advocates making it a legal requirement for those people to be accepted. – SOURCE: Mason Conservative
This is not mainstream thought just yet, at least not in public, but the thought is out there and it’s very dangerous and very scary.
When the Patient Protection and Affordable Care Act (Obamacare) was passed in 2010, there were a couple of items that resulted in increases in federal income taxes for some households. One of those items was a cap on the amount a person could contribute to a medical Flexible Spending Account (FSA).
Money put into an FSA account is considered pretax income, which means it does not count toward your income for tax purposes. So, if you had an income of $100,000 per year, but contributed $5,000 to you FSA account, then you only paid income tax on $95,000. That could result in a substantial tax savings. But there is a catch, FSAs are “use it or lose it” propositions. Whatever was left in your account at the end of the year went back to your employer.
Prior to 2012, there was no legal limit on how much a person could contribute to their FSA. The limit where I work was imposed by my employer at $5,000 per year. I contributed the maximum amount to my FSA every year because I knew I would spend it.
Obamacare put a cap on the amount an individual could contribute to their medical FSA of $2,500. On a personal level, this one provision increased our family’s tax obligation by about $1,700 last year. Other provisions increased our taxes by about $3,750. Obamacare provisions alone increased my taxes by over $5,000. Not one person who is eligible for an Obamacare subsidy has thanked me for my contribution to their medical insurance policy. But I am a magnanimous person, “You’re welcome!”
Well, the good folks at the IRS are at least trying to minimize the damage a bit. According to the Los Angeles Times,
The U.S. Treasury Department and Internal Revenue Service changed the use-it-or-lose-it rule for flexible spending arrangements, or FSAs, to allow account holders to carry over as much as $500 from one year to the next without penalty.
For a lot of folks, this is a huge deal. The risk associated with the use-it-or-lose-it characteristic has now been reduced tremendously. The other really big deal is that this rule takes effect immediately. However, employers have the option to implement the rule on FSAs currently in place, so check with your employer to see if this is an option for you this year.
This particular rule will not help people that routinely use all of their medical FSA funds, but it may encourage those who are not currently using their FSA to keep a little bit more of their money out of federal coffers.