Social Insurance is Social Security, broken down into three parts: (1) Old Age I
ID: 2781320 • Letter: S
Question
Social Insurance is Social Security, broken down into three parts:
(1) Old Age Insurance
(2) Survivors Insurance, and
(3) Disability Insurance.
Every working person contributes 7.65% of their paycheck (up to the 1st $118,500) and their employer matches the same. A self-employed person will contribute 15.3% of their pay up to $118,500. Under the Affordable Health Care Act, more commonly known as Obama Care, passed in 2009 and became law in 2010, everybody must have health insurance either privately, through their employer or through a federal or state run health exchange. If you do not have insurance, you will pay a fine.
What are your general opinions of Social Security and the Affordable Care Act?
Explanation / Answer
Enactment of the ACA brings extraordinary opportunities for greater security, affordability, adequacy, and equity in health insurance coverage. However, it also faces very substantial hurdles in both political and practical realms. These include the challenges of implementing substantial changes to the Medicaid program, significant reforms of private health insurance market regulations, development of new systems for delivering subsidies and enrolling individuals in coverage, creating greater transparency, and promoting efficiency in the delivery of health care. States will play a vital role in the implementation of these reforms and in the design of specific aspects of the changes.
The law has 3 primary goals:
The ACA takes several steps to address the problem of health-care inflation. Importantly, the ACA creates an employer mandate, which requires large employers with more than fifty full-time employees to offer affordable health coverage to employees or pay penalties. Requiring large employers to provide coverage will help prevent “crowd-out” (i.e., where coverage shifts from the private market to public programs) and potentially bring healthier people into health insurance risk pools as well as expand coverage to the working uninsured. To slow growth in costs and to finance expanded coverage, the law also implements an excise tax on those health plans offered through employer-based coverage that have the most generous health benefits with premiums paid for mostly by employers and low, if any, deductibles and little cost sharing for employees. Such benefit-rich plans protect workers from facing costs of care, but this also creates incentives for employees to overuse care, likely raising overall health-care costs. Therefore, the purpose behind the excise tax is to lower the potential “overuse” of health care that may be driven by such adverse economic incentives and, in turn, to slow health care costs.
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