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Will the Affordable Care Act impact your real estate business expenses in 2015?

By
Real Estate Agent with Keller Williams Realty Lafayette/West Lafayette, Indiana

 

 

Will the Affordable Care Act impact your real estate business expenses in 2015?

 

 

 

Under the approaching individual mandate for the ACA last year we managed to stay on our limited grandfathered health insurance plan and shop online (not Healthcare.gov) and keep our health insurance to just over $9,100.  We avoided going on the mandated ACA Bronze plan which would have cost us over $15,000 this year!

 

 

 

 

The President and Executive Department have made 24 changes to the Affordable Care Act since its passage, and I was hoping against hope that one of those executive orders would allow me to continue my non-compliant ACA health insurance like the exemptions granted to  businesses in 2014 and 2015.

My state insurance commission and Anthem said "NO" to the Executive Department ruling on March 5th, 2014, BUT YOUR STATE MAY ALLOW THE SALE of NON-COMPLIANT INDIVIDUAL HEALTH CARE INSURANCE PLANS UP TO 2017, without IRS penalty for "non-compliance". 

It is worth checking out and consulting your insurance agent/broker to see if your state will allow you to stay on your  non-compliant ACA plan for the next two years, without the IRS penalty!  WHY?  Look at the change in our business expenses for 2015 as we have to go on the Affordable Care Act mandated health insurance to avoid the IRS penalty.

 

 

 

Our ACA mandated cheapest Anthem Bronze plan will cause our health insurance to go up from $9,120 to $16,656 per year in 2015. 

That is an 82% increase! 

Our health care for our projected 2015 business expenses will now account for 40% of our costs if we can manage to hold our other expenses the same.

 

 

 

 

So why did the transition to our Affordable Care Act Health Insurance go up so much from the plan we liked that was canceled that had a LOWER deductible and was $7,500 cheaper???

 

We must now pay for health insurance that because of our lifestyle choices and circumstances we will NEVER use:  maternity benefits, pediatric care, and substance abuse and prescription drugs.  Guess what?  The other health insurance plans by different companies have almost identical prices for the same ACA approved plans.  So much for competition! 

Let the record show that our "non-compliant" current plan being canceled:   covered pre-existing conditions,  had no lifetime insurance payout cap,  included  "free" wellness visits and checkups,  had a lower deductible, was $7,500 cheaper, and did not force us to pay for coverage we would never need!

I suspect that most Americans haven't paid attention to the Affordable Care Act because their health insurance has been provided through the government in the form of Medicare and Medicaid, or through their employer which President Obama exempted in 2014.

The vast majority of Americans who receive their health care in the private sector through their employer might want to pay more attention in the future!

Why?  Left of center chief architect of the Affordable Care Act, Ezekiel Emanuel, the right of center Heritage Foundation think tank, and the US Justice Department surprisingly all agree on one thing:  that 80% of employers will drop their existing health care coverage for their employees by 2018 because of the Affordable Care Act!!!!

I hope your health insurance business expenses go down in 2015!   If not, here are some options if you wish to avoid the IRS penalty, but you must act quickly:

1.  You can buy ACA compliant plans in the private sector.  Check with your insurance agent/broker, or go online.

2.  Read the links above and see if your state will allow you to keep your current health insurance as an exemption without IRS penalty.

3.  Try the state or federal health care insurance exchanges.

4.  All the exchanges:  private, state, and federal just opened on November 15th.  You have until December 15 to select a plan and make payment if you want to be covered by January 1, 2015.

Good Luck!!!

 

 

  

 

 

 

 

Posted by

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Kathleen Daniels, Probate & Trust Specialist
KD Realty - 408.972.1822 - San Jose, CA
Probate Real Estate Services

Bruce, It will certainly impact my bottom line as the expenses are so darn high. So far, I've managed to stay on the plan I was on before because it was grandfathered in.  It's a major medical plan that covers nothing until I reach the $5,900 deductible.  With my cancer follow up ... I pay and pay and pay as I go and I pay the high monthly premium.  I hope it is repealed. I do not appreciate paying for those who don't pay for health insurance. It's a crappy deal for sure.

Nov 29, 2014 05:29 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Kathleen, I plan to keep posting more information as the network news has covered so little of the impact it has upon the self-employed and what experts are saying about how it will negatively impact millions and millions of Americans.  I have contacted my US Senators and Representative and will continue to do so and urge others to do likewise.

I have 16 days to go to try and find an "affordable" plan and so far all the insurers are priced about the same for the same deductible and coverage for where we live in Indiana.

If I lived in Oklahoma City I could have the same Anthem Blue Cross Blue Shield ACA compliant plan for $699 instead of the $1,388 per month I will have to pay because of where we live in Indiana!   That is so wrong!!!!

Nov 29, 2014 05:40 AM
Mary Douglas
United Country Ponderosa Realty, Red Feather Lakes, Colorado - Red Feather Lakes, CO
REALTOR, Red Feather Lakes, Colorado

Hi Bruce, just being able to shop across state lines seems like a good idea- can you keep your current plan at all? how much is the penalty? There is nothing "affordable" about it..in my book.

Nov 30, 2014 05:58 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Mary, no such luck for us as I have exhausted all options.  Still have 15 days to at least find the best plan online but there just isn't any competition with prices.  I am not sure if they are going to use the 2014 penalty for 2015 since they really didn't end up enforcing 2014.  I don't really care to be on the bad side of the IRS after what was going on with them seizing refunds this spring in matters related to alleged Social Security payments to deceased parents 30 to 40 years ago!

Nov 30, 2014 06:44 AM
Barbara-Jo Roberts Berberi, MA, PSA, TRC - Greater Clearwater Florida Residential Real Estate Professional
Charles Rutenberg Realty - Clearwater, FL
Palm Harbor, Dunedin, Clearwater, Safety Harbor

Once you reach the big 65, you will no longer have to worry about it. That is where I am.

Dec 22, 2014 12:44 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Barbara-Jo, I wish that were the case but there have been over $700 billion in Medicare cuts scheduled from 2012 to 2022 to pay for the ACA-the largest single hit is upon our Seniors.  It will impact senior benefits unless the executive department cancels these and then the whole promise of the ACA not being a burden on taxpayers will collapse without sticking to the Medicare cuts, which will cause the national debt to balloon  even more.

Dec 22, 2014 01:24 AM
Sharon Paxson
Sharon Paxson, Realtor® EQTY Forbes Global Properties - Newport Beach, CA
Newport Beach Real Estate

Good Morning Bruce- Merry Christmas to you and your family. I do have many opinions about this topic, and this is a very informational post about the topic. 

Dec 25, 2014 01:20 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Sharon, it was very painful paying that first installment on December 15th and there being no real competition for competing plans that offered the same deductibles.  Our health insurance will now suck up 40% of our real estate business expenses now that we have have to purchase an ACA approved plan.

Dec 25, 2014 01:29 AM
Patricia Feager, ABR,CRS,GRI,MRP
DFW FINE PROPERTIES - Flower Mound, TX
Selling Homes Changing Lives

I see the handwriting on the wall for another economic crisis that will impact zillions of people who are impacted because of the Affordable Health Care Act.

It is a great topic for discussion and I wish all Realtor Associations would get agents on board and have options available with Q&A for agents.

Dec 29, 2014 12:39 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Patricia, most people just are not that involved or impacted by the ACA yet as only a small percentage of people are self-insured.  Things will really change by 2018 once all the employers of 50 or more are forced on the system and have been there at least two to three years.  Once they start dropping their employees from coverage as the experts predict you will really have pressure put on the politicians for change.

Dec 29, 2014 07:27 PM
Kelly Hagglund
The Kelly Group Real Estate - Newberg, OR
SW Portland Real Estate Expert

Bruce Walter, great information! Thank you so much for posting! I am sorry I missed it when you originally posted it, however the information is still very valid, especially while moving into 2015!! Do you mind if I re-blog?

Dec 30, 2014 06:06 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Kelly, do so at your own risk as this can be a very polarizing issue.  Thank you!!!

Dec 30, 2014 06:34 AM
Patricia Feager, ABR,CRS,GRI,MRP
DFW FINE PROPERTIES - Flower Mound, TX
Selling Homes Changing Lives

Happy New Year Bruce.

To your health so you never have to worry.

Wishing you the best this year and always.

Jan 01, 2015 02:46 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Patricia, thanks so much and Happy New Year to you as well!

Jan 01, 2015 02:58 AM
Charles Stallions Property Manager
Charles Stallions Real Estate Services - Pace, FL
Pensacola, Pace & Gulf Breeze Property Management

Mine went from 341 a month to 765 I am not happy paying for others to have free healthcare sort of along the line of food stamps and welfare

Jan 08, 2015 12:43 PM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Michelle, it has been very painful for us and a huge jump in our premiums for health care as it will now consume 40% of our current real estate business expenses in 2015.

Jan 09, 2015 05:26 AM
Wayne Zuhl
Remax First Realty II - Cranford, NJ
The Last Name You'll Ever Need in Real Estate

Hi Bruce,

It's terrible how expensive insurance is getting to be.  

Feb 07, 2015 12:04 PM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Wayne and Jean, our business expenses for our health insurance have really gone up this year.  I have contacted our state senator and representative and have asked them to look into the very high rates offered by the insurance companies here in Indiana compared to other states.

Feb 07, 2015 09:23 PM
S. Leanne Paynter ☼ Broward County, FL
United Realty Group, Inc. - Davie, FL
Davie, Plantation, Cooper City & Weston Specialist

It's such a shame so many of us are in the same boat.  This legislation (which most Americans didn't want but Congress passed anyway!!!) has had such negative consequences on the economy.  Our health insurance premiums are about double what they were just 5 years ago, and increases with each passing year, even though we hardly use it.

Mar 11, 2015 02:11 AM
Bruce Walter
Keller Williams Realty Lafayette/West Lafayette, Indiana - West Lafayette, IN

Leanne, one of my daughers is having her pay reduced 20% as revenue has dramatically decreased where she works.  I worry for her as next year the employer will be forced to comply with the ACA in 2016 and wonder what impact that will have on the workers with their current health insurance.

Mar 12, 2015 11:20 PM