Exchanges Are Mistakes...not Markets

[Ann H]

I really doubt an individual making half a million a year won't have health insurance.

But, goddamnit, this is AMERICA, you should at least be able to make the choice without a penalty.

I mean, argument's sake, if you're 25, peak of health, with a $500,000 income, a catastrophic plan isn't a horrible idea. You can afford routine care out of pocket, you just need coverage for the obscene costs associated with something horrific. Heck, the money you save on premium will probably cover all of your usual out-of-pocket costs if you're healthy. 2 years of savings will probably cover your entire deductible if you were to have an accident. PPACA considers that to not meet the EHB because you could afford a metal-tier plan that you don't really need.

I feel like a hypocrite for saying that and being a 20-something with a PPO, but I believe the Government shouldn't have the power to compel citizens to purchase anything under any circumstance.

The person making $500,000 in your example will avoid the penalty if he/she has any type of MEC. It doesn't have to be minimum value (60% actuarial value). Remember that MEC (minimum essential coverage) is a broad term, like an umbrella. It covers everything from the skinniest large employer plan allowed by law, all the way up to a very rich plan. Even govt plans like Medicare, Medicaid, VA, etc. are considered MEC. In a subset, underneath the umbrella of MEC, lies plans with minimum value of 60% or above, and the IFP/Small Group Metal tiers of Bronze, Silver, Gold, Platinum.

The point is that this $500,000 earner might be a business owner or an employee of a large group, which is allowed to have a skinny, skinny MEC. If this person enrolls in that MEC, the individual mandate penalty doesn't apply to him.

So, let's say his 1% is $5,000, and the national average cost of the Bronze plan is $4,000. Yet maybe he wants to buy his large employer's skinniest MEC for $1200 instead. He would not have a penalty because he bought an MEC. I don't know why he would do that instead of buying a Bronze HSA, but for argument's sake, he could.