Tuesday, September 8, 2009

300 or 400 Percent of the Poverty Line: What's The Difference?

Update 3 (30 September 2013): If you are trying to find out your insurance premiums under Obamacare, check out our five-step guide to Obamacare Week, or the Kaiser Family Foundation's ACA premium calculator.

Update 2 (5 July 2012): If you are trying to figure out insurance premiums under Obamacare for households earning less than 400% of the poverty line, the post I just linked to might be more useful.

Update: people keep hitting this web page looking for what income qualifies for 300% or 400% of the Federal Poverty Line. You can work this out from the numbers on the HHS website. As of 2009, those numbers are:
  • Poverty level: $10,830 for an individual, $22,050 for a family of four.
  • 300% of poverty level: $32,490 for an individual, $66,150 for a family of four.
  • 400% of FPL: $43,320 for an individual, $88,200 for a family of four.

The answer is just under four million people. According to Kaiser's study of the 2008 Current Population Survey (which was issued in 2008 but measured in 2007), ten percent of the uninsured population earns more than four times the poverty line. Another eight percent earn between three times and four times that amount. With 47 million uninsured, that multiplies out to 3.75 million uninsured Americans in the dangerous middle ground where Baucuscare wouldn't give them much of a subsidy. The bigger story here is that extending subsidies to 400% of the poverty line will mean more generous benefits for those earning 300% or just under it, who under Baucuscare will get some help, but probably less than they need. Upping the income threshold will mean those folks get a more appropriate level of financial assistance.

Kevin Drum asks which we should prefer, a higher subsidy limit or a public option. My guess is I'd still go for the public option. In fact, given how disappointedI am in the current public option ... options ... I think that I would take Pelosi's "we'll give you a trigger, but if the insurance industry makes us pull it we're going to kill them" proposal over higher subsidy levels; either the public option will trigger and result in cost savings, or insurance costs will be lower overall. Either way, lower costs means more money for higher subsidy levels. And as we've seen with CHIP, it's relatively easy expand eligibility for existing programs, but quite hard create new programs. So if push comes to shove, take the public option.

Separately, let me rail against the Baucuscare idea of providing insurance subsidies through the tax code. This is a bad idea; further complicating the tax filing process is not going to make people feel good about themselves or their government.
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