President Obama has signed the landmark $875 billion health care reform bill into law at the White House. In our previous blog we discussed changes that could take effect immediately; but below are some changes that could take effect by 2016.
• New health insurance subsidies would be provided to families of four making up to $88,000 annually, or 400 percent of the federal poverty level.
• Health insurance exchanges would be created to make it easier for small businesses, the self-employed and the unemployed to pool resources and purchase less expensive coverage.
• Individuals would be required to purchase coverage or face a fine of up to $695 or 2.5 percent of income, whichever is greater, starting in 2016. The plan includes a hardship exemption for poorer Americans.
If this health care reform bill works as intended, many Americans could experience a decrease in medical debt and hopefully fewer medical debt-related bankruptcy filings will occur. One of the most common reasons for filing for bankruptcy is excessive medical debt that simply cannot be paid. If an individual is receiving treatment for a serious illness such as cancer, medical debt can quickly run up into the hundreds of thousands of dollars, forcing many into bankruptcy. While there may be many sides to the health care reform debate, one fact is rarely debated-Americans without health care are vulnerable to financial crisis because of inevitable medical debt. Medical debt can derail even the most carefully orchestrated financial plans leaving many uninsured Americans financially broken and facing bankruptcy.