By Tom Curry National affairs writer
updated 2/4/2010 11:29:02 AM ET 2010-02-04T16:29:02

Claim: If your employer drops coverage, you might not be eligible for subsidies to buy your own insurance.

The House insurance reform bill requires most employers to offer coverage to their employees. But it offers employers the option of not providing insurance and, instead, paying an amount equal to 8 percent of their payroll costs into an insurance fund that would be used to pay for coverage of the uninsured. If the company you work for decides to not offer insurance, you'd be required to buy coverage yourself through the insurance exchanges (marketplaces) that will be set up by the bill. If you don't, you would pay a penalty. The House bill would provide $574 billion in subsidies over 10 years to those buying coverage. But, one reader asks, "How much will coverage cost me? I make nearly $100,000 a year and I'm a single person. I won't be eligible for a subsidy? Or will I?"

Fact or fiction?
Fact. Addressing the case of a person making $100,000 a year and having his employer drop coverage, a spokesman for the House Education and Labor Committee said, "It's likely in that scenario the individual would not be eligible for affordability credits," or subsidies, to buy insurance. The House bill's subsidies would go only to people with incomes up to 400 percent of the federal poverty level, or $43,320 for a single person. If Congress subsidizes more people, it would add to the cost of the bill and Congress would need to find the money to pay for the subsidies by raising taxes, cutting other spending, or borrowing more. "The bill does not set specific prices for premiums, but does limit costs," the House aide said, by, for example, limiting out-of-pocket payments to $5,000 a year for individuals.

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