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Deseret-Obamacare marriage penalty puts pressure on couples buying insurance

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Posted: Thursday, November 7, 2013 2:10 pm | Updated: 5:53 pm, Fri Nov 22, 2013.

Nona Willis Aronowitz and her husband, Aaron Cassara, have a problem: If the New York couple weren't married, it would be easier to afford health insurance based on federal subsidies in place as part of the Affordable Care Act.

But they are married — and they're considering getting divorced, they told The Atlantic.

Ages 29 and 32, respectively, they were facing tough times for their professions, a wildly expensive city and the scary prospect that both of them could shortly be uninsured," wrote Garance Franke-Ruta.

Aronowitz is a freelance writer. Cassara is a filmmaker who works part-time and freelances. Any married couple that earns more than 400 percent of the federal poverty level, which is $62,040 for two, won't qualify for federal subsidies to help with their premiums.

The Atlantic reported that if they cohabitated, they could each earn up to $45,960 and still be eligible for subsidies through the New York health exchanges. The article noted that insurance is "comparatively expensive and the state exchange was set up in such a way as to not provide lower rates for younger people."

"Critics of the Affordable Care Act have called the pricey decision couples face the 'marriage penalty.' But the income levels for subsidies were set by Congress," according to CBS News, which also interviewed the couple.

What one will pay for insurance and whether there are subsidies is complicated and depends on where one lives and individual circumstances. CNN used the Kaiser Family Foundation's health insurance subsidy calculator to show just how complex it is. In one scenario, couples who together earned $40,000 (one made $11,000, the other $29,000) would pay "much less" for their coverage if they weren't married, as long as they lived in a state with expanded Medicaid, which would cover the low earner outright.

In a state without expanded Medicaid, "The $29,000 earner would pay $957 less for a silver plan than if she had applied for premium tax credits as part of a married couple. But here's the rub: The $11,000 earner would not qualify for Medicaid or a subsidy on the exchange," CNN wrote.

"So, in that instance, if health coverage for both partners is important, they might be better off getting married and applying for subsidized coverage as a couple, even if it costs more."

© 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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