4 in 10 Families Could Owe The Government Money Back if They Take ObamaCare Subsidies

Market dysfunction ahead: more incentive for people to postpone or decline pay increases and bonuses

This is from Chad Terhune writing at the LA Times: 

...A study published Monday in Health Affairs estimates that 38% of families that qualify for federal premium subsidies might have to repay some portion if changes in their household income aren't reported to the government.

These subsidies are a crucial part of the federal healthcare law intended to help make insurance more affordable for lower- and middle-income people. Individuals earning less than $46,000 a year, and families below $94,000 annually may qualify for these premium tax credits.

But a raise, bonus or other unexpected income during the year could alter a person's eligibility and subsidy amount, triggering a repayment when the person files income tax forms for 2014. Some policy experts worry that experience could sour people on the healthcare expansion.

"There's the potential for some sizable repayments," said Ken Jacobs, the study's lead author and chairman of the UC Berkeley Center for Labor Research and Education.

"Even if a small number of people owe a lot of money back that could generate fear of taking the subsidies. You don't want to scare people from enrolling," Jacobs added.

At particular risk of refunds, researchers said, are people who are near the eligibility cutoff for the subsidies. The tax credits are on a sliding scale basis up to 400% of the federal poverty line. ...