• Doc fix details are out

    A tip of the hat to Don Taylor for the links and short take:

    [The doc fix language] is out tonight (h/t @sarahkliff). Here is a summary of the law in more readable form. The primary pay-for is the next to last paragraph of the third page of the second document. Short version is that the ACA specified that if your income rose during the year such that your end of year income was higher than was projected (which is how amount of subsidy/tax credit was figured), then the maximum amount an individual had to pay back to the government was $250 for individual or $400 for family coverage. Now there is a sliding fee scale based on how much your income turns out to be, with much larger pay backs in force. If your income is 200% poverty, you have to repay up to $600, if it is 450-500% of poverty, you have to repay up to $3,500, with sliding scale in between.

    I didn’t realize the ACA already had a payback provision. What the doc fix bill does is beef it up to generate enough revenue for a one-year patch. Of course, the one-year doc fix patch is 2011 and the ACA subsidies (and payback based thereon) don’t occur until 2014. I’m not an expert on government budgeting but this strikes me as a bit strange. Perhaps someone can explain it to me.

    UPDATE: I realized later that, of course, the budgeting here is (as always) in a 10-year window. That’s how a 2014+ savings can “pay for” a 2011 expenditure. I know this game well. It is played all the time. It’s so nonsensical that I forgot about it for a moment.

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    • This sounds like Wimpy economics. “I will gladly pay you Tuesday for a hamburger today.”

      Steve

    • Dr Frakt,

      Government accounting is often more of a political game rather than the truth. It is interesting how FASB or SEC are so hardcore about companies presenting the facts through GAP, but the government that sets the rules are “wishy-washy” themselves at the numbers. Politics as usual.