Get ready for the next wave of ObamaCare fees.
With the launch of coverage under the health care law on Wednesday, a new set of taxes and fees is kicking in this year -- as part of the hundreds of billions of dollars the government intends to raise over the next decade to help pay for the program.
This year, the increases come in the form of fees on health insurance companies which could translate into higher premiums. And for those who don't buy coverage, the IRS plans to slap them with a fine -- some call it a "tax" -- for not complying.
"This is only the beginning," the conservative Heritage Foundation warned Thursday.
The biggest revenue-raiser kicking in this year is an annual fee on health insurers, meant to help fund premium subsidies and other provisions.
The fee is projected to bring in $8 billion this year and roughly $100 billion over the next decade. The insurance industry -- and more than 200 House lawmakers -- are trying to repeal it, warning that these costs will be passed onto the consumer (though some will get Affordable Care Act subsidies).
An industry-commissioned study by consultant Oliver Wyman estimated that rates will rise in 2014 by up to 2.3 percent for that reason alone. By 2023, the study said, rates could be rising annually by up to 3.7 percent because of the tax.
The other major fee to watch out for is the individual mandate penalty. Under the law, those who do not get insurance by the end of March and do not qualify for an exemption will be charged the fee. This year, that penalty will be $95, or 1 percent of household income, whichever is greater.
The penalty will increase considerably in 2015 and beyond, though it remains unclear whether it is big enough to compel reluctant individuals to enter the insurance market.
Finally, insurance companies are dealing with another set of increases. They are:
-- A so-called "reinsurance fee" will be applied to some health insurers this year. The temporary fee is meant to raise $25 billion over three years, to help pay for the cost of those with pre-existing conditions signing up for coverage through the ObamaCare exchanges. The fee would start at $63 per person, but then drop to a bit more than $40 per person in 2015. It would drop again the following year. Critics warn that this could result in higher premiums, much like the annual tax on health insurers.
-- Individual and group health insurers will be required to pay a small fee to fund a Patient-Centered Outcomes Research Institute. The fee is set at $2 per covered person this year, and will be adjusted annually based on "medical inflation."
-- Some insurers will also be hit with a fee to fund what is known as a "risk adjustment program." This is meant to spread the risk around, by charging policies with lower-risk customers and using that money to offset costs for policies with higher-risk customers.
-- The Department of Health and Human Services has proposed charging a monthly user fee equal to 3.5 percent of the premium for policies in the federal exchange. This money is meant to help fund the insurance exchanges.
Republicans argue that all these fees and more will contribute to rising premiums. House Speaker John Boehner recently called the law "unworkable and unaffordable."
But supporters, and the Obama administration, argue that the protections and benefits Americans are getting in return more than make up for the costs.
When coverage launched on Wednesday, the White House declared it a "new day for the millions of Americans who finally have the security that comes from quality, affordable health coverage."
Among the changes, insurance companies can no longer deny coverage to those with pre-existing conditions; insurance companies cannot impose annual caps on health benefits; and millions may qualify for subsidies to help them buy insurance. Millions more will qualify for expanded Medicaid coverage.