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Trump and Obamacare: The Law Still Requires You to Purchase Health Insurance

Several attempts to repeal and replace Obamacare by President Trump and congressional Republicans have been met with failure this year as three GOP senator broke from their party and voted against the latest version of a repeal before leaving for summer recess.

That still leaves the long-term future of Obamacare in question, but the fact remains that for now Obamacare is still the law of the land.

“We are relieved that millions and milliions of people who would have been so drastically hurt by the three proposals put forward will at least retain their health care, be able to deal with pre-existing conditions,” Sen. Chuck Schumer, New York Democrat, told The New York Times.

The latest vote — known as a “skinny repeal” — failed to pass the Senate by one vote. GOP Sens. John McCain of Arizona, Lisa Murkowski of Alaska and Susan Collins of Maine all voted with Democrats against the bill.

The lastest version of the repeal, according to The New York Times, would have made it much easier for states to water-down federal requirements for health care plans. It also would have eliminated funds in Obamacare that pay for a wide range of prevention and public health programs.

Senate Majority Leader Mitch McConnell of Kentucky had wanted the Senate to vote on an earlier repeal bill before the Fourth of July recess, but that didn’t happen.

“This has been way more difficult than it needs to be,” Sen. Ron Johnson, Wisconisn Republican, told The Washington Post. Johnson was among five senators whose opposition to the bill led McConnell to postpone a vote until after the holiday recess.

Earlier this spring, the House of Representatives passed its own bill to replace Obamacare. Whatever bill the Senate may pass would then be sent back to the House for their input and approval for a final version that would then be sent to the White House.

President Trump is expected to sign a repeal bill into law if one makes it to his desk. But will a bill ever make it to him?

Any repeal or replacement of Obamacare would have a huge impact on how Americans shop for health insurance. Lawmakers continue to be sharply divided on the issue.

Why Trump’s executive order didn’t kill Obamacare Penalty

Many thought Trump’s executive order earlier this year was the first step at a quick repeal and replacement of Obamacare. That wasn’t the case.

Essentially what Trump’s order did was direct federal agencies to minimize the financial burden of Obamacare across a range of groups, including states and insurance companies.

RELATED: 10 Ways to Lower Insurance Costs

What does that mean? Not much for consumers.

An executive order can’t undo Obamacare. That’s a job for only Congress and lawmakers obviously can’t seem to agree on a repeal or a replacement leaving Obamacare as law.

That means Americans still are required to have insurance or face penalties, so you still need to shop around for health insurance if you don’t have any or are paying too much for your current policy.

Anyone who signed up for Obamacare during the last open enrollment will still be covered for the upcoming year.

How much is the Obamacare penalty for not having insurance?

U.S. residents who skip insurance face a fine, and the Obamacare penalty for 2016 for a household is the greater of either: $695 per adult plus $347.50 per child or 2.5 percent of your household income minus the amount of the minimum filing threshold, which is the lowest income at which you need to file taxes. The same fines apply for 2017.

The penalty is capped at $2,085, the average annual premium for a Bronze health insurance plan sold in the ACA marketplace.

If you didn’t have health insurance in 2016, how much will you be fined? The penalty must be calculated in two ways, using the flat dollar amount and the income formula.

1. Flat dollar amount − Calculate the amount you’d owe based on paying the individual penalty amount of $695 for each adult plus $347.50 for each child under 18. Add those numbers for your household to get a total.

2. Income formula  Take your household income minus the minimum filing threshold amount for the year, which is the income above which the IRS requires you to file income taxes. The most recent number available, from 2015, is $10,300 for a single person and $20,600 for a married couple. Calculate 2.5 percent of that number to get a total.

Compare your flat dollar total to your income formula total. The larger number is your Obamacare penalty.

However, calculating the penalty is more complicated if you lacked health insurance for only part of the year. If you went without coverage for only one or two months, you won’t have to pay a penalty due to the short gap exemption.

To help crunch the numbers, insuranceQuotes has an Obamacare Penalty Calculator to help you easily understand the penalties.


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