Obamacare Smokers May Get A Break From Penalties- But Younger Smokers Would Pay More: Healthcare Reform 2013 Update

Obamacare smokers may get a break under the new healthcare reform bill.

Due to a computer glitch, some older smokers may get coverage under President Obama's health care, as opposed to penalties for tobacco-use penalties that could otherwise have made their premiums unaffordable.

There is a computer system glitch that means penalties that could have been charged to smokers will be limited under the new Obamacare health reform law.

Older smokers will likely benefit the most from the glitch-but it also means that younger smokers might get hurt the most. Younger smokers may face higher penalties than they otherwise would have.

Older smokers may be able to save about $4,500 a year on premiums. The law allows insurers to charge smokers up to 50% higher premiums-but it also says that insurers can't charge older people more than three times what they charge younger people.

A fix for the computer glitch will likely take a year to put into place.

Under Obamacare, people who don't have health insurance through their jobs will be able to buy private insurance and use tax credits to pay for some of their premiums. Small businesses will be more able to provide insurance to their employees.

"Because of a system limitation ... the system currently cannot process a premium for a 65-year-old smoker that is ... more than three times the premium of a 21-year-old smoker," the industry guidance said.

The Obama administration is currently  suggesting that smokers of all age be penalized 20%...which would be much less than older smokers, who would have otherwise had to pay 50% more. Some say that would have also priced them out of having health coverage.

The new plan will require insurers to accept anyone who wants healthcare, regardless of how old they are or whether they have pre-existing condtions.

Under the new plan, a 64-year-old non-smoker would pay about $9,000 a year for a standard Obamacare insurance plan. However, a smoker who gets a  50 percent penalty would be given an added $4,500 bill, and this would bring the total around $13,600.

Younger smokers, however, would be paying much more than they normally would.

 "It's going to throw cold water on efforts to get younger people to sign up," Larry Levitt, an insurance market expert.