Medicare meets Obamacare-part 2.

Let's begin by dealing with a couple of idiot emails about the Affordable Care Act (ACA) which have "gone viral" recently.

The first is on the "Hot 25" list at snopes.com. It claims that there is a "secret" part of the ACA--being hidden until after the election-- which will cause Medicare part B premiums to balloon to $247/month in 2014. Here's what snopes has to say:

"The short answer to the question of the whether these figures for Medicare insurance premiums are accurate is no. "

"In the last few years, the standard monthly premiums for Medicare Part B have been set as follows:

2009: $96.40
2010: $110.50
2011: $115.40
2012: $99.90"

"(Many beneficiaries paid less than the listed amounts in 2010 and 2011 because of the "hold-harmless" provision of Medicare which states that if the dollar increase in your Medicare Part B premium is bigger than the dollar increase in your Social Security check, you don't have to pay the difference.)"

"As for future Medicare Part B premium rates, the information cited above is wrong on two counts: No provision of the health care legislation passed during the Obama administration sets Medicare premium rates, nor is a whopping jump of over 100% to a $247.00 monthly premium in 2014 a realistic figure." [Emphasis mine.]

"New Medicare premium rates come out each fall and take effect in January. Medicare beneficiaries as a group are required to pay one-fourth the cost of running Medicare, and annual premiums are set at a figure calculated to achieve that level of revenue. Although the annual premium rates aren't officially set until they are announced each fall, Medicare administrators track trends and anticipated changes and use them to formulate projections of Medicare premiums for the next several years. According to the most recent report of the system's trustees, issued in May 2011, those projected premiums (as listed on page 218) are:

2013: $110.50
2014: $115.80
2015: $120.80
2016: $126.00
2017: $132.70
2018: $140.30
2019: $148.40
2020: $158.60"

The second email is an oldie-but-goodie which has been repurposed by opponents of the ACA. It claims that the ACA will be paid for by imposing a 1% tax on all banking transactions: deposits, withdrawals, checks, etc.

We've dealt with this one before. See the post about "Hair-on-fire emails." You can read the details in the above post, but the short story is that it's a load of baloney. There is no such tax and--since it's the pet project of a single member of Congress who introduces it every session, but receives no support from anyone else--it's not likely there ever will be such a tax.

Are there real taxes that Medicare participants will pay to fund the ACA? If you have Medicare, you will NOT be subject to the tax imposed on those who do not have health insurance.

If your yearly income is above $200,000 ($250,000 for a married couple) AND you are still working, your Medicare payroll tax will increase by 0.9%. 

If your yearly income is above $200,000 ($250,000 for a married couple) your investment income in taxable accounts (which EXCLUDES IRA's, 403(b)'s and 401(k)'s) will be taxed at the rate of 18.8% instead of the current 15%. There are, of course, no taxes for ANYONE on investment income within tax-sheltered accounts such as IRA's, etc.

If you use a tanning parlor, there will be a 10% tax on tanning bed use. (Not sure how many Medicare participants want to make their skin look even older and more leathery, but who knows.)