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  • Holiday Specials on Lab Tests December 18, 2014
    Give the gift of health and wellness this holiday season. This is a great way to be proactive and keep up with your health as well as that of your loved ones. Below are the December specials from DirectLabs. You …
  • The Truth About Sugar December 15, 2014
    The past decade’s focus on low-fat diet has led to an unintended consequence, an increase in sugar consumption. Many people are not aware of exactly how much sugar they are actually consuming. The sugar, processed food, and beverage industries do …
  • Yet Another ObamaCare Miscalculation December 12, 2014
    by Marilyn Singleton MD, JD On November 13th, the Government Accountability Office (GAO) issued a report finding that that enrollment for the state-operated Small Business Health Options Program (SHOP), created by the Affordable Care Act, was significantly lower than expected. …
  • Ralph Weber Talks About Root Causes of High-Priced Healthcare – Video December 10, 2014
    The main reasons that health care costs so much are because of lack of transparency, lack of competition, and the complexity of the system. There is a lack of transparency between the patient and the provider, as well as between …
  • Here’s The Thing #6: Root Causes December 10, 2014
  • Yogurts: Not All Are Created Equal December 8, 2014
    by Adrienne Snavely Most commercial yogurts are full of artificial colors, flavors, and sugar, which stimulate disease-causing bacteria, yeast, and fungi in the gut. This overpowers your good bacteria, increasing the chance you’ll get sick. Healthier yogurts are pasteurized at …
  • The Scientist, the Sage, and the Homunculus: The Psychology of Direct Pay Medicine December 7, 2014
    How Patients and Doctors Make Decisions About Payment for Care. Dr. Robert Emmons and Dr. Josh Umbehr of http://Atlas.MD discuss the psychology behind direct pay medical care. From September 4, 2014, AAPS 71st Annual Meeting.
  • “The Rich, Fat Giant & the Free Market” – A Bedtime Story December 5, 2014
    by G. Keith Smith, MD When my children were young, I used to make up bedtime stories for them, stories they recently reminded me they remember even now.  I hope you enjoy the following actually true story, many versions of …
  • Hysteria’s History Episode02 FINAL December 4, 2014
  • Should You Worry About Phthalate Exposure While Pregnant? December 3, 2014
    Chemicals called phthalates are used to make plastic items more flexible. They are found in packaged foods and personal care products. In the past few years, studies showed that phthalate exposure put pregnant women at risk of complications and fetal …
  • Beyond Mere Board Certification: Paul Kempen, MD, PhD December 3, 2014
    Dr. Paul Kempen exposes the truth about Maintenance of Certification (MOC) in a presentation to physicians in the St. Louis area on November 22, 2014.
  • Health Benefits of Coconut Oil December 1, 2014
    Coconut oil is a saturated fat that helps you lose weight, decreases inflammation, fights infection, and protects the brain from Alzheimer’s disease. It works the opposite way other saturated fats do by improving the ratio of “good” to “bad” cholesterol …
  • Thanksgiving Special from MediBid for Physicians & Patients November 26, 2014
    Happy Thanksgiving from MediBid! MediBid is offering 25% off annual registration to give thanks to all of the freedom fighting doctors and facility administrators we have out there! We have a large group of self pay patients looking for quality …
  • Fraser Institute: Waiting Your Turn, Medical Wait Times in Canada 2014 November 26, 2014
    The Fraser Institute study, Waiting Your Turn: Wait Times for Health Care in Canada, is Canada’s only comprehensive measurement of wait times for medically necessary health care. Based on an annual survey of physicians practising in 12 specialties in each …
  • Why You Should Eat More Prunes November 24, 2014
    Many people are not fans of prunes, yet sales of “dried plums” are on the rise. Prunes have been a popular digestive remedy for decades with their fiber, stool loosener, and natural laxative compound. They are a sweet treat for …
  • ACA Architect Gruber Insults Voters November 21, 2014
    MIT economist Jonathan Gruber (an architect of Obamacare) has emerged in a handful of videos insulting the American public. In one video, Gruber discusses how voters’ “lack of economic understanding” enabled a politically unpopular tax on “Cadillac” health plans to …
  • Are You Vitamin D Deficient? November 19, 2014
    Many Americans believe they are not at risk for Vitamin D deficiency because they eat D-fortified foods. These foods do not contain enough Vitamin D to benefit your health. Vitamin D is not a regular vitamin, but a steroid hormone …
  • Ambulance Drones Could Help You Survive a Heart Attack November 17, 2014
    Heart disease is the #1 cause of death in the United States. The odds of surviving a heart attack outside of a hospital is only 8%. Four out of five heart attacks occur at home where there is no emergency …
  • Eugenics in America – In the Name of Science November 17, 2014
    Marilyn M. Singleton, M.D., J.D. presents at the AAPS 71st Annual Meeting, September 5, 2014, Charleston, South Carolina
  • Supreme Court to Examine Issue of Obamacare Subsidies November 14, 2014
    The Supreme Court will decide the fate of Obamacare yet again. This new case challenges the key issue of subsidies used to assist in purchasing insurance in the exchanges. This decision to hear the King v. Burwell case has surprised …

The Cliff Effect: Obamacare Takes a Double Shot at the Economy and the American Dream

Subsidy Cliff Effect in Health Care InsuranceThe ‘cliff effect’ described here is something I’ve been worrying about for more than a year now.  Based on Kaiser’s calculator using my age, earnings and location, I’m in a spot where a tiny increase in income will have a dramatic effect on the subsidy I might get.  But what scares me is that it isn’t just me, it is that everyone like me will be faced with this, and many will be blindsided by it, which isn’t fair at all.  Like described below, a small shift of an annual income, say an additional $500 per year, or even $5 if I were that close to the marker (which shifts constantly), could push someone like me into the next bracket for subsidy, reducing the subisdy by thousands.  The situation below is extreme, but possible.  When I calculated it out (read more of my calculations here), I found that the subsidy drop off was much more drastic than the increase of income needed to produce it.  Which means someone can get a pay raise, only to find themselves without enough money to pay their health insurance premium anymore, let alone pay that and the rent.  This pay raise becomes a false sense of security, and most people celebrate getting a raise, which would only put them in debt in these cases.  I think this is horrible.  Only those who have benefits through their employer are safe from this cliff.


From the Foundry.  Click here to read the entire article.

Beginning in 2014, when the new health insurance exchanges will open for individuals and small businesses, subsidies will become available for those whose income falls between 134 percent and 400 percent of the federal poverty level (FPL). For a family of four living in a high-cost area, earning 134 percent of the FPL ($31,389 in 2014 dollars) would qualify them to receive $22,740 in assistance. A similar family earning an income at 400 percent FPL ($93,699) would qualify to receive $14,799 in subsidies.

The problem is that as income increases, families will experience large reductions in government assistance, which will discourage striving to earn a higher income. According to Kessler, “Economists call large, discontinuous changes in program benefits like this ‘notches.’ Although notches might be administratively convenient, they have terrible incentive effects.” One of these is “a substantial punishment on work effort.” If a member of a family of four living at 400 percent of FPL earns just $1 more, they would receive no subsidy at all, making the family almost $15,000 poorer. This “cliff effect” will have profound implications on the labor market. Heritage analysts Brian Blase and Paul Winfree write, “the subsidy structure creates incentives for individuals to engage in unproductive activities, such as working less and retiring early.” These income “cut-offs,” which already present issues in Medicaid, induce sharp reductions in the labor supply—not good when the economy is already struggling to recover.



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