Phil Castell
Castell Insurance
426 E. Washington St., Sequim, WA 98382
Phone: 360-683-9284 • Fax: 360-683-9026
Phil@CastellInsurance.com
www.CastellInsurance.com  

 

OK, I grant you that the title for this column could be slightly cryptic for some readers. But I am sure more than 80 percent of the general public and 99.5 percent of my readers easily could figure out the clue.

I am a little immodest when I say 99.5 percent of my readers can figure it out, but you have proved that you are smarter than average just by reading my column.

 

The Supremes I referenced are not the same ones who were on stage with Diana Ross, but rather the nine justices of the U.S. Supreme Court, and the ACA is the much-talked-about Affordable Care Act.

 

Last week the Supreme Court devoted an almost unprecedented three days to hearing oral arguments regarding President Obama’s Affordable Care Act.

 

The lawsuit was filed by the attorneys general from 26 states. Washington’s Attorney General Rob Mc-Kenna was one of the 26 who filed suit. He went against the expressed desire of Gov. Christine Gregoire. It may be no coincidence that he has announced he will be running for governor in November as a Republican and was trying to distance himself from the Democratic positions of both the president and governor.

 

The three days of arguments were made available from various news sources as well as the official website of the Supreme Court at www.supremecourt.gov.

 

The main opposition to the health care bill is the “individual mandate” that requires the vast majority of people to carry health insurance.

 

If they chose to not purchase, they would be required to pay an additional amount when they filed their annual returns with the IRS. I worded that quite specifically, as one of the big questions is whether this additional payment is a penalty or a tax.

 

One of the questions before the Supreme Court is that if it is a tax, can the Supreme Court hold hearings or render a judgment before someone actually has had to pay the tax? If not, the first time a person would have to pay that fee would be in 2014 and then the case would have to be refiled at that time and then work its way through the normal judicial channels until it once again landed before the highest court in the land.

Some ACA background

When the ACA was first passed in March 2010, it included a number of provisions to be implemented prior to the main components of the plan in 2014.

 

These were attempts by the government to garner the support of the general public for the program by frontloading additional benefits.

 

Among the first benefits were to those folks who were covered on Medicare Part D Prescription Drug Plans, who reached the coverage gap or doughnut hole.

 

Starting in September 2010, people were to receive a one-time, $250 check to help cover some of the extra costs associated with their drug costs. Then in 2011 it was increased to 50-percent coverage and that amount will be increased each year until 2020 when the co-pay will be just 25 percent.

 

For younger people with individual health insurance plans, starting in 2011 they had access to preventative services without any co-pays or deductibles. In addition, the lifetime maximums on policies were removed. Previously it was common for a plan to have a lifetime maximum of either $1 million or even $2 million.

 

The goal of the ACA is to provide coverage for most of the 30 million people who currently do not have health insurance. The plan is for people to purchase insurance through health exchanges, using navigators to assist with the paperwork.

 

Much of the implementation for the exchanges and navigators are left to the discretion and rulings of the individual states. Later this month I will be attending a meeting in Olympia where these specific questions will be on the agenda.

Looming cost increases

Health insurance is not inexpensive and the costs for this will be massive. Medicaid is the federal program that is funded jointly between the federal and state governments and acts as the safety net for approximately 30 million people.

 

With the expansion of the health insurance mandate, it is anticipated that the rolls of those on Medicaid will swell by an additional 17 million. The federal government will fund 100 percent of the additional costs for the health care of those 17 million, but for how long has yet to be determined.

 

This is another cause for concern for the individual states, whose budgets already are under severe pressure due to the economy. The states assume that at some point the federal government will try to pass on some of the costs of the extra people on Medicaid to the states.

 

This whole case has been fast-tracked and the Supreme Court is expected to render a verdict sometime in June, well in advance of the upcoming general elections in November.

 

The outcome of this case will touch every one of us, to some extent, in the next few months and years and so I encourage you to read and learn as much as possible as the more you learn, the more interesting it becomes.

Phil Castell is an independent insurance agent in Sequim. He can be reached at 683-9284 or PhilCastell@msn.com.