Can a smarter, more informed DUer explain how tax credits would work for healthcare?

[BannonsLiver]

I'm asking in the context that it looks like the GOP is going to be promoting this as one of their selling points for ACA replacement.

this seems like "hey we'll give you a tax break at the end of the year and you'll get a bigger refund check but you'll have to wait all year to get it" type of thing.

Will the bill collectors wait as well?

[elleng]

1. WOULDN'T.

[Ace Rothstein]

8. /end thread

[SharonAnn]

43. Not well. It would cost you. It's giving you coupons to use for maybe a discount.

[Warpy]

2. Tax credits are one of their more hilarious ideas

because it doesn't do to write off $50K in taxes to buy a family's health insurance if they pay under $2K in taxes, which are most families out there. It's an idea that works fine for Congressmen and other high income people but is a farce for 99% of us.

Try to find a family health plan for under $2K per year. That's the fatal flaw in the plan. They simply have no clue how much the average tax break would be, nor do they have a clue about what a family's disposable income is and how it's generally earmarked for things like shoes for the kids instead of fattening health insurance executives.

[BannonsLiver]

4. It seems very flimflam

[Yupster]

13. I heard it was a proposed "refundable tax credit"

Which means you'd get the 5,000 or whatever deduction even if you didn't pay 5,000. In the case of you paying 2,000 taxes and getting a 5,000 refundable tax credit, you'd get a 3,000 tax refund.

[not fooled]

36. Oh, they know that tax credits won't come even close to covering the cost of insurance

They just don't care.

They are trying to acclimate the middle and lower classes to accept dying of preventable causes and not having healthcare.

After all, they've taken away pensions, good jobs, unions, and much else and just keep accumulating more power, so none of this seems to hurt them.

[Warpy]

42. They also know that stupid people will hear "$50,000 tax credot!"

and think Uncle Sugar is going to hand them a $50,000 windfall every year and they can go on a spree after they get their insurance.

[SharonAnn]

44. Read a recent study saying that the average health insurance cost is $10k per person per year.

[Warpy]

45. And will double in a few years of no ACA

while covering only healthy people and children.

I just wonder how the schmucks are going to blame the Democrats for it.

[Talk Is Cheap]

3. I'll give it a try...

A tax credit is "an amount of money that can be offset against a tax liability."

So, instead of actually reducing one's healthcare cost thru lower premiums,
a tax credit reduces your 'tax liability'. This implies that you made enough money,
and taking into account your other deductions, to even get a tax deductions.

As always, republicans only want to screw the 99% while enriching the 1%.

[KittyWampus]

5. It's like getting a rebate. What good is a $15 rebate for a $1000 bill when you're short on money?

[subterranean]

6. If it's a refundable tax credit, you receive it even if you owe no taxes.

The problem with this idea is that many people don't have the money to pay $6,000 - $10,000 in insurance premiums for a year, plus whatever healthcare costs they incur, while they wait for their tax credit the next year.

Also, the tax credit, as I understand it, would be based on age rather than income, so someone making $1 million would get the same credit as someone who made $25,000.

[sarcasmo]

12. The right in Washington live on fantasy island.

[TexasBushwhacker]

16. And of course the wealthy get the biggest credits

Because they pay the highest tax rates. And what do you want to bet it won't be a refundable credit, so it won't help the poor at all. Trump also wants to get rid of the "Head of Household" classification on income taxes, because if anyone deserves to pay more taxes, it's single parents!

[subterranean]

17. I think they said it would be a flat credit, so everyone gets the same amount.

But there should be an income limit on it, like there is with some other tax credits. Someone who makes a million dollars (or even half a million) doesn't really need help to pay for health insurance.

[Demsrule86]

28. It is unacceptable and a non-starter.

[roamer65]

7. They won't.

Unemployed, disabled, etc will be SOL...especially if they block grant Medicaid.

[Squinch]

10. Won't the reddest states likely be the ones most hurt by this block grant idea? Or am I

misunderstanding how block grants work?

It seems to me that wealthier states could adequately fund Medicaid in spite of a block grant system, while the red "taker states" would likely not be able to do so.

[Demsrule86]

15. The red states don't want to do so.

But I think the genie is out of the bottle and the GOP will have trouble with this.

[Squinch]

18. I agree, but as I see it, this is just the Republicans absolutely wanting to screw their base again.

The red states and red counties tend to be poorer. If they receive only block grants they likely are not able to subsidize them when needed to keep the medical care at a basic level.

They REALLY hate their people.

But I think you are right that this isn't going to happen.

[Demsrule86]

21. I have a niece in Georgia who has no health care of any sort...they are already

refusing to provide any sort of medical care to many people...there is a waiting list even for the kids...and the situation is so dire...the only charity hospital and trauma center in the area may close...people come from two or three hours away...as it is the only game in town for the poor.

[Squinch]

22. In the wealthiest country in the world. "Protect the unborn. Leave the BORN to die in the streets."

[Demsrule86]

23. Yes, my cousin died in a boating accident just before Obamacare was implemented.

He had no insurance and could not get it as he was a twin and had pre-existing conditions. His Mom would have bought it for him...price was not the issue...they waited until his Mom got to the hospital to try a life saving surgery ...she had to sign that she would be responsible for the bill...but by then it was too late. This was in Virginia. I myself nearly died and was left unable to bear children after a Georgian right to life doctor waited for blood work proof that I had miscarried...by then I had hemorrhaged all over my kitchen terrorizing my kids ....I was rushed to the hospital and ignored while said doctor tried to hurry the blood work. Hubs got their quickly, or I would be dead...he saw me lying on a gurney in a pool of blood unconscious...and screamed bloody hell...fired the doctor and a young resident saved my life...three weeks in the hospital...multiple transfusions...this is what health care means if the GOP gets to call the shots. The GOP are evil incarnate.

[Squinch]

24. Oh, God. I am so sorry. About both tragedies. To think that we had put this behind us and now

they want to bring it back.

They're disgusting ghouls.

[Demsrule86]

25. Yeah...and in Georgia now...it is even worse.

[LiberalArkie]

30. You ever wonder why. If the baby is delivered, the ob/gyn, the hospital, the nurses all make money.

If an abortion takes place, they don't get all the money (or in the case of a poor person, the debt to write off).

[Squinch]

31. I don't understand this. Abortions cost money and those who provide them are paid.

[LiberalArkie]

37. Different people, not the big corporate hospital.

[LiberalArkie]

38. Nationwide, the cost at health centers ranges from about $300 to $1,700 for abortion in the first

trimester.

A natural childbirth with no complications will cost anywhere from $8,000 to $16,000.

A childbirth by way of Cesarean will cost anywhere from $12,000 to $24,000.

[Squinch]

40. Oh, I see what you mean. I still think though that it goes back to wanting to keep the

wimmins from getting uppity, and to punish those sex-having wimmins, more than financial.

[eniwetok]

9. tax credits are more GOP "welfare" for those with money.

No GOP plan to date really deals with the grotesque dysfunction in our health care system because they clearly prefer government power to be use to benefit parasitical health insurance companies than the American People.

[Blue_true]

11. Tax credits only help people that have significant

income. But whether they are useful or not depend on how republicans structure them.

[PoliticAverse]

26. That's only true if the tax credits are not "refundable". Refundable tax credits...

(like the "earned income" tax credit) are effectively transfer payments.

[Demsrule86]

14. It would never work period and is a ruse by the evil ones who are ok with leaving 40

million people without healthcare while they enjoy the finest healthcare in the world...but I think if they do this the gerrymander is history. I don't think the GOP will touch healthcare this year.

[Vinca]

19. Most likely it's somehow connected to their love of health savings accounts.

You know. You, the person who can't afford to pay a fortune out of pocket for adequate health insurance, is suddenly going to have enough spare cash to stow away in your health savings account to pay for medical bills under your new GOP policy that has a huge deductible and doesn't cover anything. The tax credit works if you file a long form tax return and then deduct your deposits to the health savings account. You get to save money for your own healthcare tax free. Isn't that just ducky?

[Cosmocat]

20. For the love of all things holy

What you just described is so fucking simple and obvious, I just don't get how people just don't start to pick up shit and throw it at these assholes when they put this kind of shit forward

But, their 1/3 of the country laps open up and demands everyone bend over and lube up for it, and the "middle" 1/3 of the country obediently obeys ...

[annabanana]

32. this . . . n/t

[HassleCat]

27. It's Ayn Rand time, of course.

I think they will come up with a complex web of health savings accounts, tax credits, and other miscellaneous gar-bahszh. Nobody will be able to figure it out, but it will look generous and comprehensive on paper.

[mulsh]

29. folks living pay check to pay check would get a voucher crediting the payments they can't afford to

make. They can then claim the deduction on their simple tax returns, if they file a tax return. I think the money they couldn't afford to spend comes back the next year in their tax return. Oh wait, that only works if you file the one with deductions. hmmm.

It's an elegant solution: it sounds like a good deal unless you're one of those mythical people living pay check to pay check, or under water after working two jobs or someone with a remnant of care for your fellow citizens.

Kind of like school vouchers work for average people except more cruel and even less beneficial.

(re: school vouchers, every private school I know of requires parent participation or charges a fee if parents cant participate, this is never included in any voucher plan I've ever seen,. the plans don't cover any additional fees or costs either. Just one of the issues I've got with vouchers)

[taught_me_patience]

33. You're describing a tax deduction not a tax credit

Tax credits provide a deduction against tax liability. Tax deductions reduce the amount of income subject to taxation.

[taught_me_patience]

34. I think the idea is that the tax credit will fund the current year HSA

which will help cover the deductables for that year. The problem is year one, when people have to fund the HSA out of pocket and wait for the tax credit reimbursement a year later.

[moriah]

35. Unless they've advanced and hefty, they wouldn't work.

Which, of course, means they wouldn't work.

[Hoyt]

39. Tax Credits seem to work fine with ACA/Obamacare now. You don't have to wait until end of year

to use them. Now the GOPers will likely reduce the tax credit, that's where the problem will arise.

This is one explanation of how it works under Obamacare/ACA --

Advanced Premium Tax Credits

A tax credit can be paid in advanced to your insurer through the Marketplace. This is called an Advanced Premium Tax Credit. The amount paid to the insurer is the difference between your premium cap and the cost of the plan. You’ll see that number reflected when you compare marketplace plans.

NOTE: You can also choose to take only part of the tax credit in advance, or none of the tax credit in advance, and simply deduct the tax credit on your tax returns. If your unsure of your income this is the safest bet, even though it’s less fun than saving money up front.

[subterranean]

41. But that's not how it will work with the GOP's Obamacare replacement.

Under their proposed replacement, it won't be an advance credit. Right now, the advance premium tax credit is only available for ACA marketplace plans, which the Republicans want to abolish. The tax credit they are proposing will be a fixed amount paid once a year to subsidize the purchase of plans on the open market.

[Hoyt]

46. As callous as GOPers are, they are not going to propose a tax credit for the poor that

is not good until months after the fact. Now, they might make that credit a lot less, pay the insurers directly, or go to some modified voucher system. We are criticizing the wrong thing, IMO.