Cost of preexisting conditions to be $63 a year for the insured


Already insured workers are going to take a hit in the wallet to cover preexisting conditions under the Affordable Care Act. Image from Wikimedia Commons.

If people want the government to pay for stuff, that money has to come from somewhere. That means taxes, and the tax required to pay for people with preexisting conditions to get insurance under the Affordable Care Act will cost anyone with insurance $63 per year.

Tax to pay for preexisting conditions takes effect in 2014

It is certainly true that people with preexisting conditions, or preexisting medical conditions, probably should be able get insurance coverage. If they’re willing to pay premiums, why shouldn’t they be allowed to have it?

It turns out the federal government agreed, or at least a lot of former Democratic congressmen agreed and they passed the Affordable Care Act, mistakenly referred to as “Obamacare” though all the president did was sign it into law. As a result, insurance companies cannot exclude people from coverage due to preexisting conditions. As with any other government regulation of commerce, that means the money has to come from somewhere.

The extra costs on insurance companies means the people left holding the check are those that already have insurance and the employers who purchase it, according to CBS. It doesn’t kick in until 2014, but $25 billion has to be raised between 2014 and 2017.

Annual cost of $63

Buried in the ACA’s text is a fee that has to be imposed on everyone that currently is insured, to pay for those with preexisting conditions. The fee is going to be assessed on every business that provides insurance for its employees, much of which will likely be passed on to the roughly 190 million people who get insurance through their employers.

The fee will differ by the company; large firms will get the largest bills, smaller businesses will get smaller bills from Uncle Sam. The fee is $63 per insured person, which according to is assessed annually. Assuming all of it is passed on to employees, that’s an extra $5.25 per month. Not exactly the difference between the lifestyle of Croesus and starving in the street and taking payday loans just to pay the rent, but still a dent.

On the bright side, the fee declines every year after that, dropping from $63 per head in 2014 to $50 the next year, until it phases out completely in 2017.

To pay for Paul means taking from Peter

All told, aside from just that $25 billion cost to cover people with preexisting conditions, the ACA mandates $700 billion be raised from various sources over a decade. Noble as the idea is to get more people covered under health insurance, a lot of Peters are having to pay for Pauls, so to speak.

As a result of the health care law, premiums have been starting to slowly go up. For instance, According to the Washington Post, HR consultancy Mercer found in a recent survey this year that 12 percent of employers with at least 500 workers have raised premiums on health insurance, compared to 10 percent last year. Anyone with insurance can probably expect to pay more in coming years, for everyone else.




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