Democrats are worried that millions of young and healthy Americans will refuse to buy health cover under Obamacare.
It is a cause of concern - as when people find their premiums are almost double, will prefer to remain uninsured and then buy cover only when needed. Under The Affordable Care Act a penalty is charged to those who do not buy health insurance - this penalty is lower than the coverage would cost and the penalty would only be deducted from the tax returns at year's end. The IRS could not deduct penalty from assets or wages, but only from tax refunds.
AdvertisementThere are some policies available to those who want to avoid Obamacare which are built on a life insurance platform rather than health insurance. This is out of the hands of Obamacare.
A person buys life insurance for $250,000 which is the maximum amount paid on death. This policy includes a "Critical Illness" component - when the policy holder has an injury or requires surgery the insurer will pay the amount and reduce the same from his life insurance benefit. Say the customer uses $10,000 for his medical needs; the insurer will pay out $ 240,000 later. The critical illness component accelerates the benefit payout.
The cost of a policy for a 30 year old male is around $1,438 a year and a 50 year old male would pay $3,234 a year. This not being a health policy the benefit is passed on to the estate upon death. In case the demand was high insurance companies could offer people similar policies without coming under federal regulations.
Hannah Punitha (IRDA Licence Number: 2710062)
Merrill Mathews, June 2013
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