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CPA Colorado: The Impact of Recent Rulings on Obamacare

When the Affordable Care Act—better known as Obamacare—was signed into law in 2010, CPA Colorado firms like KKB knew that their work was about to change dramatically. But we didn’t expect things to still be changing.

In July, two contradictory federal court rulings cast uncertainty on Obamacare’s future, and KKB outlines what might possibly happen in terms of tax planning and practice management.

The Affordable Care Act has faced many challenges since its inception, from a Supreme Court case questioning its constitutionality, to repeated votes to repeal it by the House of Representatives, to the botched rollout of HealthCare.gov, to the recent Supreme Court Hobby Lobby ruling that employers are not required to provide birth control coverage. Still, millions of previously uninsured Americans are now, either through the health insurance plan provided by Obamacare, or through preexisting insurance that some employers are now required to provide. Originally, Obamacare intended that each state set up its own exchange to provide the coverage, like Connect For Health Colorado. However, some states opposed to the law opted out of creating exchanges, so the federal government had to do their own outreach in those states, through HealthCare.gov and other avenues.

But some court cases this past year have challenged whether the original law allows the federal government to provide this coverage, and on the same day, two courts disagreed on this matter.

So how does all this affect your taxes, and how could it affect them in the future? Federal health care coverage is paid for in the form of tax subsidies. That means that as an individual, you buy health insurance, and the government gives you a tax rebate; as a business, you buy your employees health insurance, and the government gives your company a tax rebate. However, if more rulings agree that only state exchanges are allowed to give you tax subsidies, then Colorado employers and individuals may be getting less money back for what they spend on insurance, and states without exchanges will be pressed to establish them. Our CPA Colorado accountants at KKB will be following this closely!

How To Use This Information

When it comes to accounting and practice consulting, you want people who stay up to date and adapt to change in creative ways. CPA Colorado accountants at KKB are just that, and will help you or your business with any financial qualm or question you have. Give us a call at (303) 815-1100, or contact us online.

Do you know how the Affordable Care Act has affected your life?


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