Obamacare is an act of the government of the United States of America that was formulated and signed into law in order to give affordable insurance services to the citizens. The health insurance act of 2010 has become very popular, not only to the citizens of the United States of America but also the population worldwide. The Act was meant to ensure that the people living in the United States of America are all covered by the health insurance, regardless of their income. The reason is that these families to not get enough cash to ensure their safety. The Obamacare insurance scheme is meant to ensure that even the low-income families in the United States of America can secure a health insurance plan that will be offered by the help of the government.
The Obamacare will have a huge effect on the population’s tax payment. The initiative, as proposed by the head of the government, is meant to offer affordable care for all the citizens of the United States of America. The citizens will, therefore, fund the project through taxation. Taxation is one of the many ways that the government gets money to fund its expenditures. A tax can be described as a the percentage of money that is charged to the individuals’ income, goods and services produced or imported and on the profit made. Providing affordable healthcare will be essential to the investors as their workforce will have a good health that will allow them to offer their time and skills on a full-time basis. On the other hand, taxpayers will experience a change in taxation as discussed below.
The Obamacare targets higher income earners who will contribute more towards the project. In the essence of ensuring that equity is observed, the government will come up with a taxation system where those are earning higher being taxed more than those earning less. The idea is that higher income earners have more funds to support their household than the less earning group. When the two categories are equally taxed, the lower income earners will experience hardship in funding the households and the rest of the activities. The formula used in taxation has outlined that an extra tax of 0.9% will be charged to all the workers earning more than $ 200, 000. The strategy implies that higher income earners will contribute more to the initiative.
Obamacare initiative will lead to increased taxation on the individuals’ income derived from investments. Most of the people who are not employed by the government do invest in various fields. Their core reason for investment if to earn a profit. The government taxes the profit earned annually for the purpose of funding various projects. In order to effectively fund the Obamacare medical project, the government is introducing a 3.8% tax on the profit earned by individual investments that make a profit of $200,000. For a married couple, the 3.8% tax will be charged if the profit hits $250,000. The tax on investment exceeds the usual tax as Obama care is an expensive initiative. The citizens and investors must contribute more in order to sustain the project. The investors have lamented over the increased charges as it seems to take away much of their hard earned profits.
Another attribute that denotes the Obamacare medical cover initiative entails the contribution made by the individuals covered by the project. When individuals get involved in the payment of medical cover premiums, they are subjected to tax relief. The relief on tax is meant to encourage more people to join the activity. Due to the introduction of Obamacare project, tax relief will be offered to individuals contributing more than 10% of their gross income to any other medical cover. The percentage is much higher than the previous requirement of 7.5%. The amount is practically higher to hit and, therefore, most of the population will somehow contribute largely to the Obamacare.
The Obamacare also affects the prices of the medical facilities as a result of imposing taxes on them. The strategy will lead to a tax of 2.3% on every medical facility produced by the manufacturers. In other words, manufacturers will be required to pay a 2.3% on every item that they produce for medical use. The imposed tax will lead to the increase in the prices of medical facilities. Increasing the price of the medical facilities will disturb the growth of the private medical providers as the extra tax will be passed to the buyers. The public hospitals being funded by the government will not experience the burden. For the private hospitals, they will face difficulty in acquiring the more expensive facilities. The strategy to increase the tax on medical facilities is viewed as a long-term strategy of the government to have a monopoly over the control of medical facilities.
The Obamacare medical care will be an expensive initiative to the citizens. Theoretically, it seems as only affecting the working class and investors. In reality, every citizen will be affected by the project as taxes imposed on various commodities consumed domestically will lead to increased prices of commodities. The domestic and other household goods are presumed to become more expensive. The government projection that determines to cover all the lower income citizens for free by 2016 is a huge challenge. Taxes on household goods will be the way to go in order to cover the expected expenditure to run the project. In other words, all the citizens will feel the pain of increased taxes on various products as a means of funding the project.
The Obamacare insurance scheme is one of the best insurance projects that any government can think of as important to the nation. Although there is some disagreement with some members of the society, the scheme will highly transform the lives of the citizens of the United States of America in a positive way. The health of the economy will be achieved through peoples’ ability to access health services and will bring happiness in their lives. Although the project is vital to the citizens, there will be a need to engage experts in designing a better funding strategy.
References
Reece, Richard. Understanding ObamaCare: Travails of Implementation, Notes of a Health Reform Watcher. New York: West Bow Press, 2014.
Tate, Nick. ObamaCare Survival Guide: The Affordable Care Act and What it Means for You and Your Healthcare. New York: Humanix Books, 2012.
Atlas, Scott.Reforming America’s Health Care System: The Flawed Vision of ObamaCare. New York: Hoover Press, 2014.