Smokers to Benefit or Hurt from Obamacare Loophole

Smokers who were looking to get health coverage in the next year may benefit from a glitch in the Obamacare health system reform.  The Obama administration, which is currently in a health care overhaul delay has discretely admitted to insurers that a computer glitch will be responsible for limiting the number of penalties smokers would have faced in the future.  The worst part of it all (or best depending on whether or not you smoke and your age) is that a fix will take over a year to produce.

Analysts speculate that older smokers will be the first to benefit but it might be possible that at the same time, younger smokers will face higher premiums than ever before.  A document from the Health and Human Services Department stated that, “Because of a system limitation … the system currently cannot process a premium for a 65-year-old smoker that is … more than three times the premium of a 21-year-old smoker.”  If the said insurer tries charging more, “the submission of the (insurer) will be rejected by the system.”

Now, keeping this statement in mind, the new legislation also allows insurance companies to charge smokers up to 50 percent higher premiums which would mean a policy for a 64 year old nonsmoker which goes for about $9,000 a year can be bumped up to $13,600 for the same age person who does smoke.  Here is where the glitch comes in.  A provision in the health care law states that insurers cannot charge older customers more than 3 times what they charge young adults.  The computer is unable to accommodate the two groups and thus issues have arisen.

Before the glitch, it was thought that younger people would pay less in premiums and older people pay more but two solutions have been proposed due to the problem.  The first would be to limit the percentage of penalties to 20 percent of the original premiums.  The other would be to charge the full penalty to both groups.  If the first option is elected, older people would receive more in savings but if the second is elected, younger people would see a huge spike in pricing.

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