The Times waits until the Saturday before Christmas to drill down on the redstributive nature of ObamaCare, but they start with a doozy:
New Health Law Frustrates Many in Middle Class
Ginger Chapman and her husband, Doug, are sitting on the health care cliff.
The cheapest insurance plan they can find through the new federal marketplace in New Hampshire will cost their family of four about $1,000 a month, 12 percent of their annual income of around $100,000 and more than they have ever paid before.
Even more striking, for the Chapmans, is this fact: If they made just a few thousand dollars less a year — below $94,200 — their costs would be cut in half, because a family like theirs could qualify for federal subsidies.
I know what everyone is thinking. Everyone! Over at ThinkProgress, some progressive is frantically typing "$100,00! Suck it up and quit whining, you wealthy exploiters of the less privileged! Time to share!" [The Washington Monthly delivers, denouncing a 54 year old secretary and a 55 year old retired firefighter as whining yuppies; sue me.] For their benefit the Times includes this:
The Chapmans acknowledge that they are better off than many people...
And on the right, folks are wondering just what this couple does because in New England a fifty year old teacher married to a fifty year old cop could easily be clearing $100,000, despite an absence of private jets in their lifestyle and the presence of a middle class vibe. And that is not such a bad guess:
“We are just right over that line,” said Ms. Chapman, who is 54 and does administrative work for a small wealth management firm. Because their plan is being canceled, she is looking for new coverage for her family, which includes Mr. Chapman, 55, a retired fireman who works on a friend’s farm, and her two sons. “That’s an insane amount of money,” she said of their new premium. “How are you supposed to pay that?”
Doies she think the price is insane? Wait'll she learns it includes mental health coverage! And maternity care! That'll cheer her right up.
As to the absurd tax cliff embedded in ObamaCare, we discovered that ourselves back in October. At 400% of the poverty line (which varies by family size) the subsidies bring the net premium down to 9.5% of income. Earn a dollar more than that, and the whole subsidy goes away.
So lets plug the current example into the Kaiser Family Foundation subsidy calculator. With income of $94,200 the Chapmans (two New Hampshire adults aged 55 and 54; two kids; I guess all to be non-smokers with a ZIP code of 03060) would get a subsidy of $6,360 per year to bring the cost of a Silver plan down from $15,309 to $8,949 per year, which is 9.5% of their hypothetical annual income of $94,200.
But - hard luck! - they earn a bit more than that, so their subsidy is zero. $530 a month is a lot of money for most people, but she works for a hedge fund or something like it so as far as our friends on the left are concerned, screw her. And screw the retired firefighter, too.
Of course, Mickey Kaus notes that people may just figure how to enhance the finagling of their taxes; the payoff to under-reporting income in the middle brackets has gone way up, especially at the subsidy cliff. That is a win-win for the left, since Pikkety and Saez can then report a decline in middle-class incomes and Obama can fret some more about rising income inequality.
This situation reminds us of the absurd defense of the random ObamaCare redistributions offerred straightfacedly and heroically by Jonathan Cohn of TNR. His gist - all the redistribution comes from taxes on Mitt Romney's sons and the other rich. We all know why he chose to ignore the obvious redistribution fail covered today by the Times.
MORE: Using the Kaiser estimator an intrepid researcher can search for subsidy cliffs all over the country. Which the Times did!
An analysis by The New York Times shows the cost of premiums for people who just miss qualifying for subsidies varies widely across the country and rises rapidly for people in their 50s and 60s. In some places, prices can quickly approach 20 percent of a person’s income.
Experts consider health insurance unaffordable once it exceeds 10 percent of annual income. By that measure, a 50-year-old making $50,000 a year, or just above the qualifying limit for assistance, would find the cheapest available plan to be unaffordable in more than 170 counties around the country, ranging from Anchorage to Jackson, Miss.
A 60-year-old living in Polk County, in northwestern Wisconsin, and earning $50,000 a year, for example, would have to spend more than 19 percent of his income, or $9,801 annually, to buy one of the cheapest plans available there. A person earning $45,000 would qualify for subsidies and would pay about 5 percent of his income, or $2,228, for an inexpensive plan.
In Oklahoma City, a 60-year-old earning $50,000 could buy one of the cheapest plans for about 6.6 percent of his income, or about $3,279 a year with no subsidy. If he earned $45,000, with the benefit of a subsidy, he would spend about $2,425.
Remember - We had to pass live with the bill the current version of the bill as arbitrarily re-defined by Obama to see what's in it.
STILL MORE: In addition to the light comedy provided by the Washington Monthly (a 55 year old retired firefighter is a whining yuppie?) we see Dean Baker discovering that health care is expensive even if it is hidden by employer sponsorship. We await the day he discovers that rising health care costs are a big part of the stagnant wage story which so vexes the guardians of the middle class:
Experts note that employers focus on total compensation costs—that is, the combination of wages and benefits— so increases in health benefits will result in lower wage increases than would occur if health benefits did not increase. The Council of Economic Advisers reports that between 2000 and 2009, workers’ average total compensation (wages and benefits) grew by 1.3 percent per year (after adjusting for inflation).
The growth rate of premiums for employer-sponsored coverage was much faster, however, averaging 5.1 percent per year (after adjusting for inflation) during this period. As a result, the portion of workers’ total compensation going toward employer-sponsored health insurance premiums expanded from 7.4 percent in 2000 to 10.3 percent in 2009. The average wages workers received net of insurance premiums (that is, after subtracting the employees’ premiums) grew by only 0.7 percent per year (adjusted for inflation) between 2000 and 2009.