The Affordable Care Act (ACA) requires all of us to have health insurance that complies with the law in 2014. Coverage can come from your employer’s group insurance plan, your spouse’s employer plan, through a government program such as Tricare, Veterans Services, Medicare, or Medicaid, or from a policy that you purchase through the Marketplace or directly from an insurance company.
If you fail to enroll in an ACA qualified plan, there are three consequences.
1. Medical expenses are your financial responsibility throughout 2014.
2. You will not have an opportunity to enroll until the Open Enrollment begins for 2015. This means that ACA compliant individual insurance policies will not be sold outside of Open Enrollment unless you qualify for a Special Enrollment period.
3. You will be subject to a penalty when you file your 2014 tax return. You will pay whichever of these amounts is higher:
a. 1% of your yearly household income; or
b. $95 per person for the year ($47.50 per child). Maximum family penalty is $285.
c. If you are uninsured for just part of the year, 1/12 of the yearly penalty applies to each month without coverage. The penalty does not apply if you are uninsured for less than 3 months.
d. If you enroll in a health insurance plan by March 31, 2014 (end of Open Enrollment), you won’t have to make the payment for any month before your coverage began.
The requirement to have ACA compliant coverage begins on the date your policy renews in 2014. If your insurance renews outside Open Enrollment, you will qualify for a Special Enrollment period that begins 30 days before your plan ends in 2014. You have 60 days to enroll in coverage, either inside or outside of the Marketplace. To avoid a gap in coverage, enroll in a new plan by the 15th of the last month of your current insurance policy.
You will also be eligible for a Special Enrollment period when a Qualifying Life Event occurs.
1. Getting married
2. Birth, adoption, or placement of a new child
3. Moving to a new area that offers different health plan options
4. Losing other health coverage. This can include job loss, change in eligibility for group benefits, divorce, death, loss of Medicaid benefits, and expiration of COBRA. Voluntarily quitting health coverage or not paying your premium is not considered loss of coverage.
5. For people already enrolled in Marketplace coverage, having a change in income or household status that affects eligibility for tax credits or cost share reduction benefits.
ACA compliant coverage is available to individuals only during an Open Enrollment or a Special Enrollment period. Short-term health insurance plans may be the only option outside of these times.
Employer Health Insurance Plans
• Employers may begin a group insurance plan at any time during the year.
• The Employer Mandate for large groups (more than 50 employees) has been postponed again to 1/1/2016.
• If your plan offers a lower premium for completing a smoking cessation program, then encourage your employees to use this resource.
by Chris McPike, Vice President
ComPro Insurance
402-488-5100