Health Care Mandate

The Affordable Care Act (Obamacare) means that most people are generally required to have health insurance.

You may have it through your employer or obtain it yourself from an insurance company or through the Healthcare MarketplaceMedicare also counts.

Every person in your household must be covered for the entire year.  There is a penalty, that goes up yearly, if you don’t comply. This penalty is also known as the “Individual Shared Responsibility Payment”

The penalty for not having health insurance in 2016 and 2017 is the greater of…..

  1. $695 per adult ($347.50 per child)…up to $2,085 per household.
  2. 2.5% of the amount your household income that exceeds the filing threshhold.  The maximum would be the total yearly premium for the national average price of a Bronze plan sold through the Marketplace.

 

The penalties for previous years:

  1. 2014: $95 per adult ($47.50 per child)…up to $285 per household  OR 1% of the amount your household income exceeds the amount that requires you to file a tax return
  2. 2015: $325 per adult ($162.50 per child)…up to $975 per household  OR 2% of the amount your household income exceeds the amount that requires you to file a tax return

 

There are some exceptions, called exemptions, to the penalty, but most people don’t qualify. Some exemptions are:

 

If you aren’t offered insurance through an employer, and you don’t find insurance somewhere else, you may want to price it though the Health Insurance Marketplace.  OPEN ENROLLMENT time for 2017 began on November 1, 2016.

Important dates:

  • Open enrollment began on November 1, 2016
  • You must enroll by December 15, 2016 for coverage to start January 1, 2017.
  • JANUARY 31, 2017 IS THE LAST DAY TO ENROLL IN OR CHANGE YOUR 2017 COVERAGE. Coverage would begin March 1, 2017.  Certain life events may qualify you to get 2017 coverage after this date such as births, divorce, etc.

 

Depending on your income, you may even qualify for a premium credit which is a portion (or possibly all) of your premium paid for you on your behalf.  If you do receive this premium credit it’s important that you update your information on your income, number of people in your household, and your address on the Marketplace website as soon as they occur.  These changes may cause a change in the amount of your premium credit, which would take effect at that time.  The reason that is so important is that the premium credit amount is computed on your tax return and, in most cases, you are due MORE or have to PAY BACK some of it.  Your refund is reduced (or your balance due is increased) by the amount of the payback amount. You generally will not be eligible for the credit if you file Married Filing Separate.

You should receive a Form 1095 from either your insurance company, the Marketplace, or your employer (if they are self-insured) for use when preparing your taxes.  It’s important that you supply those forms to us along with your other tax documents.

A Form 1095-A is used when you obtain insurance through the Health Insurance Marketplace. It will show the amount of Premium Tax Credit received.  You should receive this by early February.

Form 1095-B and Form 1095-C are used to show that you are covered with minimum essential coverage.  Your employer or insurance provider will send you Form 1095-C if the employer is considered an applicable large employer.  If your employer is not considered a large employer, they will provide you with a copy of Form 1095-B.  An employer must furnish this form by March 2, 2017 to each employee that would have been considered a full-time employee for at least one month during the 2016 calendar year.  Please note, even if you do not participate in your employer’s health plan, they must still provide you with either Form 1095-B or 1095-C.

Below are some helpful links:

Q&A from the IRS

IRS info on the Premium Tax Credit

Information to have on hand when you apply for coverage.

To preview plans and prices for coverage in 2017.

Affordable Care Act Estimator Tools

Estimate your individual responsibility payment