Although the American Health Care Act designed to repeal and replace the Affordable Care Act or “Obamacare” did not get enough votes to pass to the next stage to become a healthcare reform law, it did provide Americans details about potential future reforms. Many political experts agree that any Republican plans to appeal and replace the ACA will include a provision that critics have called an “age tax.”

1. What is the Age Tax?
Although the American Health Care Act designed to repeal and replace the Affordable Care Act
or “Obamacare” did not get enough votes to pass to the next stage to become a healthcare reform
law, it did provide Americans details about potential future reforms. Many political experts agree
that any Republican plans to appeal and replace the ACA will include a provision that critics
have called an “age tax.”
A Penalty You Can’t Afford
The Affordable Care Act currently prevents healthcare insurance companies from charging more
than three times the amount they charge other policyholders of any age for premiums. Insurers
claim that they need to charge seniors more because of the high cost of coverage related the
elderly having more health problems on average. Based on the AHCA, any new conservative
plan would allow insurers to charge seniors 60 years and older, whether they have Social
Security income or not, premiums up to five times more than younger policyholders. “Age tax”
essentially describes a penalty based on age discrimination that comes in the form of higher
insurance premiums.
Waiting Longer for Retirement
Since many seniors live longer on incomes roughly around or below the national poverty level of
$12,060 per individual, premium hikes that increase overall costs by $3,000 or more a year could
actually bankrupt a lot of seniors, especially those who receive Social Security disability
benefits, unless they drop their healthcare coverage entirely. If you fall into this category or you
make only twice the national poverty guideline amount, you need to reconsider your retirement
age and savings situation.
Additional Disturbing “Taxes”

2. The premium hike “age tax” is not the only potential healthcare-related, tax-like provision.
Conservatives have also revealed that they would drop critical subsidies that seniors use to cover
costs not covered by health insurance down to only a few thousand dollars per year. The new
amounts would in no way cover the difference of tens of thousands of dollars between coverage
and non-coverage that often happens with hospital stays and various medical treatments. Also, if
your health is good at present and you drop your healthcare insurance coverage to try to save
money and then try to set up new coverage, you face an extra premium hike in the form of a
surcharge.
Retirement Planning Considerations
Beyond halting your retirement and continuing to work for as long as possible, it is important
that you invest your money so that you have enough saved to deal with these challenges. Speak
with your financial adviser about retirement planning and investment options like a savings
accounts and certificates of deposit. Additionally, prepare to spend less after retirement. Many
retirees stop working and start spending. They give themselves gifts like vacations that they
always wanted to go on or a new car or house. As a result, think about the things that you wanted
to do after you retire and start saving for those plans as well. Otherwise, you might have to put
aside a lot of your retirement dreams.
William Doonan is a tax law and legal expert in Bronx, NY