I’ve heard terrible things about Medicaid – doctors won’t take it, you get sub-standard care. I don’t want to deal with any of that. Is it ethical to inflate your income to avoid being placed in Medicaid under the Affordable Care Act?
Dear Calculating Odds,
Even if it were ethical, it would only work temporarily. When you file your taxes, the truth will come out. If you do not earn enough to have to file taxes, then I suppose the truth could stay hidden for longer. On the other hand, if you are earning less than the tax-filing minimum, you are not required to have health insurance.
Under the inflated-income scenario, you will pay more for your health insurance than you would otherwise. The government subsidies to help you pay for your plan will be lower, based upon your higher income. (You can try different scenarios using the Kaiser Family Foundation’s subsidy calculator. Keep in mind that the calculator is estimating how much your plan will cost; your actual cost may be lower or higher.) You may find this difficult to afford over time, and lose your health insurance. This would put you in line for the penalty, or at the very least, for being uninsured.
Being honest would be simpler and would ensure that you have coverage when you need it.
Aside from all of that, the horror stories you hear about Medicaid are likely exaggerated. Medicaid is the largest insurer of people under age 65 in the country. It provides care for 58 million people. With more people joining Medicaid – due to health reform – I expect the stigma to fade.