David Kline: 'Cover Oregon' Doesn't Have Me Covered
What happened when I tried to sign up for insurance through Oregon's health exchange.
Oct. 25, 2013 7:29 p.m. ET
Despite official statements in recent days, the problems at the federal and state health insurance exchanges are far from merely "technical." Based on my experience trying to navigate the utter confusion at the "Cover Oregon" health exchange over something as simple as determining one's income and eligibility for tax credits, I wonder if they'll ever get ObamaCare working.
And I'm someone who would love to sign up for one of the plans.
Consider, for example, that under the Affordable Care Act, income for self-employed people like myself is supposed to be determined by one's estimated 2014 modified adjusted gross income, or MAGI. Under the law, this means your net business income (gross income minus ordinary business expenses, or Line 12 on IRS form 1040) minus any IRA contributions, the deductible portion of self-employment taxes, and the premiums you paid for health insurance.
But question No. 26 of the Cover Oregon health application asks you to state not your net income but your "gross income (before costs and deductions)." There is no place to enter ordinary business expenses—at least 30%-45% of gross income for most small businesses—to get to your net business income, which is the starting point for determining MAGI.
Am I supposed to ignore the reference to "gross income" and simply enter my net business income instead in answer to question No. 26?
Nobody at Cover Oregon knows.
Or, as an alternative, am I supposed to enter the ordinary business expenses I deduct from my gross income on question No. 29 instead? That question asks if you have any extra deductions for "IRA contributions," "other taxable adjustments" (whatever that means) or "self-employment deductions," a category that sole proprietors, small businesses and CPAs generally take to refer to the deductible portion of self-employment taxes.
Specifically, should I include ordinary business expenses as an extra deduction under "self-employment deductions" on question No. 29 along with the deductible portion of my self-employment taxes?
Nobody at Cover Oregon knows.
Then there's the rather glaring problem that eligibility for tax credits—one's estimated 2014 MAGI—is partly determined by one's estimated health-insurance costs in 2014. Which, of course, can only be determined by trying to come up with—you guessed it—your estimated 2014 MAGI.
When my insurance agent, doing me a favor, called Cover Oregon to ask these questions, a representative put him on hold for 10 minutes while she "researched the questions." She finally came back on the line and said she couldn't find any answers.
Again, I'd love to sign myself and my family up for ObamaCare—it will save us hundreds of dollars a month in premiums compared with the individual coverage we now have through Regence BlueCross. And it promises to give us much better coverage, thanks to the increased competition the exchanges offer in the individual insurance market.
That's how free-market forces are supposed to work. Too bad the exchanges were built and run by people who are not subject to those free-market forces.
Mr. Kline is a journalist and author in Portland, Ore. http://online.wsj.com/news/articles/SB10001424052702304799404579157630628710134