Nearly 100,000 Bergen and Passaic county residents could qualify for tax credits under health care law
Nearly 100,000 Bergen and Passaic county residents could qualify for tax credits to pay for health coverage next year according to a report released Wednesday, but advocates worry that as many as three-quarters of them might not be aware they are eligible.
Overall, more than 610,000 people in New Jersey meet the guidelines to purchase coverage in the insurance exchanges being established through the Affordable Care Act, Families USA, a health care advocacy group, said in the report, titled “Help is at Hand.”
The report found that the vast majority of eligible New Jerseyans – 84 percent — will be from working families, with 60 percent having annual incomes that are two to four times the federal poverty line, which translates into between $47,100 and $94,200 for a family of four.
“This reaches well into the middle class,” said Ron Pollack, executive director of Families USA, a health care advocacy group.
The benefits under the Affordable Care Act, often called Obamacare, take effect Jan. 1, but the enrollment period will open in October and run for six months. Individuals and families will have a number of decisions to make, particularly those who currently have health policies through their employers that have higher premiums and less coverage than those offered through the insurance exchanges run by the federal government.
Although Governor Christie twice vetoed legislation that would have created a state-run insurance exchange, New Jerseyans can still participate in the federal-run marketplaces, which offer essentially the same eligibility standards and benefits.
The Families USA report used census data to offer New Jerseyans some of the first specific details – on a county level – of who is eligible and what some can expect to pay based on their income and family status. The federal government will offer a tax credit on a sliding scale to those who buy insurance through these exchanges, with those who earn more receiving a smaller credit, said Pollack. Those who are eligible can expect to pay “thousands of dollars less,” he said.
The report offers the following scenarios as examples:
ä A single woman with annual income of $23,000 — twice the poverty line — could expect to pay $1,450 a year, or $121 a month, for a basic plan in the federal marketplace that would otherwise cost $5,000 a year. An upfront tax credit of $3,550 would be applied to pay the remainder of the premium cost.
ä A couple with two children with an annual income of $35,500 — 50 percent above the poverty line — could expect to pay $1,410 a year, or $118 a month, for a policy that would otherwise cost $12,500, with the tax credit making up the difference.
In both cases, neither enrollee has to file a tax return before applying the credit to their premium bills.
“It’s not like somebody has to lay out premiums and then try to get reimbursed by the IRS,” Pollack said.
There will be a range of plans with different coverage terms and different prices. Insurance companies in New Jersey have yet to submit bids to offer plans in the marketplace so details of the various coverage levels to be offered are not yet known, said U.S. Rep. Frank Pallone, the New Jersey Democrat who was a primary sponsor of the law.
But all of the policies – even those offered at what is being called the basic silver level – are required to have sufficient provider networks and benefits that include such things as prescription drugs, maternity care, mental health, rehabilitation services and even pediatric dental and vision care.
“They will be guaranteed good-benefits packages,” Pallone said. “Too often in the past when people purchased insurance [as individuals] they got a skeletal policy.”
Not all of the estimated 1.3 million New Jersey residents without health insurance will be eligible for the tax credit, and previous estimates have suggested that only 250,000 of those who are will sign up in the first year.
The health care law is intended not only to offer coverage to those without it but also to individuals those who are paying more than 9.5 percent of their income on premiums. However, some have expressed concern that families with premium costs that exceed that amount are not eligible for tax credits to buy into the exchanges.
The law’s advocates say the federal government needs to begin heavily promoting the program in New Jersey because it appears many are not aware of the eligibility criteria and the benefits offered.
“We’ve seen surveys that show three out of four people who are uninsured today don’t know that they are eligible,” Pollack said. “People may have heard the arguments about Obamacare and the mandates, but what has not really sunk in is how they personally might be affected.”