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Penalties Under Affordable Care Act

In march 2010 President Obama signed into law the Affordable Care Act. The law aims to increase the quality of health insurance, lower the cost of healthcare premiums and provide relief for the more than 40,000,000 uninsured Americans.
In march 2010 President Obama signed into law the Affordable Care Act.

The law aims to increase the quality of health insurance, lower the cost of healthcare premiums and provide relief for the more than 40,000,000 uninsured Americans.

"In Indiana we have almost 900,000 uninsured Hoosiers. Now bring it down to the Wabash Valley, just in Vigo County the 2010 data shows 15,000 in Vigo county. Now let's go to the surrounding counties in the Wabash Valley, that number is right under 30,000," Pat Carney Vice President of Employee Benefits at Old National Insurance said. 

Included in the law is an individual mandate.

It requires the majority of Americans to have health insurance.

Andy Horning, Indiana's most prominent Libertarian, says the mandate is unconstitutional. 

"The 9th and 10th amendment clarify the purpose and power of the constitution as granting government only a few key powers. The federal government has less powers than the state has. We've got this badly wrong and we've just kinda handed the keys over to Caesar," Horning said. 

The US Supreme Court disagrees.

In a 5-4 decision last year the court upheld the law's individual mandate.

As a result, beginning next year Americans without health insurance will be penalized.

"I can actually go January, February, March without signing up for coverage. It's really going to be April 1 that the penalty will kick in," Carney said.

That penalty will either be a flat dollar amount or a percentage of the household income, Whichever is greater.

"The penalty year two, three, and beyond will be a pretty big deal," Carney said. 

In 2014 the penalty for not having health insurance will be $95 per adult or 1% of the household income.

The next year the charge goes up to $325 or 2% of the household income.
 
In 2016 It reaches $695 or 2.5% of the household income.

The money will be withheld from a person's federal tax returns.
 
"Now all of the sudden instead of getting $1,500 back, maybe I'm only getting $500 or $600 dollars because of that penalty," Carney said.
 
It's a penalty some see as unnecessary.
 
"It's illegal, it's unconstitutional, it's immoral and its not going to work. So fair hardly enters into the equation when it comes to something this bad," Horning said.
 
But for others it's more of a wake-up call.
 
"I've gotta believe more importantly it's trying to get the individuals attention, the households attention that every American should have health insurance," Carney said.
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