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New Plan Proposes Fines For Not Having Health Insurance

Posted by Chrissie Cole
Wednesday, September 09, 2009 11:40 AM EST
Category: Major Medical
Tags: Protecting Your Family, Health Insurance and Managed Care, Uninsured, Underinsured, Health Care Reform


IMAGE SOURCE: © iStockphoto / Global healthcare/ author: gmutlu

Americans could be hit with hefty fines for failing to buy health insurance under a new plan that circulated in Congress on Tuesday.

The latest proposal, a ten-year, $900-billion bipartisan compromise was put on the table by Sen. Max Baucus (D-Mont.) a moderate who heads the influential Finance Committee.

Just as auto coverage is mandatory in most states, the plan would require all Americans to get health insurance once the system is overhauled.

The penalties for not having insurance would be as follows: $750 for individuals and $1,500 for families per year. While households making three times the federal poverty level – about $66,000 for a family of four – would face maximum fines up to $3,800 for families and $950 for individuals.

The proposal would also offer tax credits to help pay premiums on health insurance for households making up to three times the poverty level and for small employers paying average middle-class wages. People working for companies that offer health care benefits could avoid the fines by signing up.

The fines pose a dilemma for President Obama. As a candidate, the president campaigned against making health insurance a requirement, saying it was too expensive to mandate. White House officials have begun to somewhat back away from that stance, but there is no indication to suggest the president would now support fines.

Meanwhile, an idea Obama championed during and since the campaign – government insurance – appeared to be in trouble.

Obama’s commitment to a public plan has been under fire. Lawmakers are seeking specifics from the president in his speech to a joint session of Congress on Wednesday night. So are his fellow Democrats, who are divided on how to best solve the problem of the nation’s nearly 50 million uninsured.

The complicated plan would make several changes in the health care system, many of them debatable, such as new fees on drug companies, medical device makers and insurers.

President Obama will be addressing the nation tonight at 8 p.m. Eastern Time to discuss Health Care Reform. #

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