New health care law: advice needed

Financial advisers should brace for the brave new world of helping clients navigate tax brackets in order take the best advantage of tax credits included in the health care reform law, according to Carolyn McClanahan, an adviser with Life Planning Partners. Speaking Sunday in San Antonio as part of the Financial Planning Association's annual conference, Ms. McClanahan, a physician who has read the entire healthcare bill, said most of the new law should be left alone, as is. However, she explained, there will be new challenges for advisers, such as calculating tax credits for incomes that are measured at various percentages above the poverty level. "That part is a mess, and for you hourly planners, you're going to have a windfall," she said."There will be two new jobs for planners: managing the tax mess and helping clients get the insurance they need." Ms. McClanahan said it took her 40 hours to read the entire healthcare bill, which she jokingly compared to a great novel, without as many words as one might expect. The presentation, which began with her holding up a handmade cardboard sign asking the audience not to throw tomatoes or eggs at her, was designed to hit the high notes, including some of the pros and cons of what people can expect as the law starts to take effect. One sad reality, she explained, is that the law will be more expensive for healthy people and less expensive for unhealthy people. However, she warned, "50% of illness is not due to lifestyle." "I hate to tell all you healthy people this, but you're going to get sick sometimes," she said.