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About Health Insurance

The Affordable Care Act (ACA) was signed on March 23, 2010 it mandates all legal residents and U.S. citizens to have qualifying health insurance with minimum essential coverage or face an annual penalty that is assessed against your Federal taxes. 

Penalty

In 2014 the penalty was 1% of your taxable income or $95 per person whichever was greater, 2015 it  is 2% or  $325 per person up to $975, and 2016 it will be 2.5% or $695 per person up to $2,085 and the penalty will increase each year annually by the cost of living adjustment.

If you do not have credible insurance your penalty is 1/12 of the annual penalty for every month you do not have insurance.  If you do not have insurance for only 1-2 months you do not have a penalty.  Your tax accountant is your best source for information on insurance penalties. 

Minimum Essential Coverage:

  • Employer coverage,  COBRA, and retirement (employer or Medicare)
  • Coverage purchased in the individual market or the Exchange
  • Most Medicaid coverage
  • CHIP, Children’s Health Insurance Program
  • Certain kinds of Veterans programs
  • TRICARE (military)
  • Coverage provided to Peace Corps volunteers
  • Coverage under the Non-appropriated Fund Health Program  (see Department of Defense)
  • Refugee Medical Assistance supported by the Administrator for Children and Families
  • Self-funded health coverage offered to students by universities for plan or policy years
  • State high risk pools

Exemptions (the following can change) this list is as of 2015

  • Some religious consciousness
  • Health care sharing ministry
  • Indian tribes
  • No filing requirement (your income is below the threshold for filing a tax return)
  • Short coverage gap – A gap in coverage that lasts less than 3 months qualifies as a short coverage gap.  Only one gap per year is allowed.
    • You are considered covered any month you had credible insurance even for one day.
    • If more than 3 months cannot claim above 3 months
  • Hardship.  The Health Insurance Marketplace has to certify you have suffered a hardship.
  • Unaffordable coverage options.  You cannot afford coverage because all options available to you would cost more than 8.05% of your household income.
  • Incarceration.  You are incarcerated after the disposition of charges against you.
  • Not lawful present.  You are not a U.S. citizen, a U.S. national, lawful alien.  A U.S. citizen who has spent 330 full days outside the U.S. a year or was a bona fide resident of a foreign country for a full year.

Some states have their own marketplace/exchange but quite a few states use the national Federal Exchange as of 9/18/2015 the states that had their own exchange were:

STATEMARKETPLACE
CaliforniaCovered California
ColoradoConnect for Heath Colorado
ConnecticutAccess Health CT
HawaiiHawaii Health Connector
IdahoYour Health Idaho
KentuckyKynect
Maryland Maryland Health Connection
MassachusettsHealth Connector
MinnesotaMnsure
New YorkNew York State of Health
Rhode IslandHealthSource RI
VermontVermont Health Connect
WashingtonWashington Healthplanfinder

The rest of the states are sponsored through the Federal government either wholly or state based through the government and are all through healthcare.gov.

All insurance plans have been impacted by the ACA if you are confused or need help please seek assistance from a qualified agent.

Premiums

Children can be covered by their parents insurance up to the age 26 even if they are married, not living with their parents, attending school, not financially dependent on their parents or eligible to enroll in their employer’s plan.

Premiums are based on age, premium rating area, family composition and tobacco use.

They can no longer use your gender or health status  as factors to charge higher premiums.

There are family ratings which take into account the rating of the oldest three children (although there is no limit to the number of children in a family unit).

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