How Is Obamacare Funded? 
Let us begin by being clear on what ObamaCare is not . The Affordable Care Act -LRB- a.k.a. - ObamaCare -RRB- does not in itself provide insurance to anyone . ObamaCare is a bureaucratic & administrative structure that imposes requirements on the private health insurance system and , where accepted by state governments , expands the eligibility range for qualifying for Medicaid . It is funded through government appropriations channeled through several departments of the government -LRB- Health & Human Services , IRS , DOL , etc. -RRB- , a wide range of new taxes -LRB- tanning salons , medical devices , taxes on Blue Cross/Blue Shield plans , taxes on health insurance companies , increased Medicare Part A tax on high income wage earners are few examples -RRB- , changes to existing tax breaks -LRB- reducing the FSA deduction from $ 3500/yr to $ 2500/yr and eliminating the eligibility of over the counter drugs from coverage under FSA plans -RRB- , a $ 63 per employee per year fee assessed on group health insurance plans , the eventual employer mandate and individual mandate tax penalties for non-compliance , reductions in the amount of out of pocket medical expenses you can deduct from your personal income taxes -LRB- threshold increased from 7.5 % to 10 % of income to qualify for a deduction -RRB- , fees -LRB- insurance companies have to pay for the privilege of selling their products in the government marketplaces -RRB- , and $ 700 billion in what would have been increased spending on Medicare over the next decade was shifted over to help fund Obamacare . This is not a total listing but hits many of the essential high points of where the money is supposed to be coming from . 