The Health Insurance Marketplace is obtainable by most people. However, there are specific requirements that must be reached in order to be eligible.
- Must be a United States citizen, a United States national, or “lawfully present” immigrant
- Must reside in the United States
- Not currently incarcerated
Minimum Essential Coverage:
Individuals must purchase a health insurance plan that meets “minimum essential coverage” and must maintain it throughout the year, or obtain an exemption in order to avoid being charged a fee, often referred to as the “fine,” “penalty,” “individual mandate,” or “responsibility payment.”
Minimum essential coverage insurance includes the following types of health insurance:
- Coverage in the Health Insurance Marketplace
- Medicare Part A and Medicare Advantage plans
- A majority of Medicaid coverage
- Children’s Health Insurance Program also referred to as the CHIP program
- Some VA coverage plans
- Employer-sponsored coverage
- Peace Corps-provided coverage
- Refugee Medical Assistance being supported by the Administration for Children and Families
- Non-Appropriated Fund Health Benefit Program coverage
- Student health coverage offered by universities (depending on the date of enrollment)
- State high risk pools coverage (depending on the date of enrollment)
It is also important to know the types of plans that do not meet the minimum essential coverage. The following types of insurance include the following:
- Short Term nor Fixed Benefit plans
- Supplemental Medicare such as Medigap and Medicare Part D
- Limited Medicaid coverage
- Limited Benefit plans (vision only, dental only, etc.)
- Grandfathered plans may avoid the fee, but will not provide the new rights and protections
Tax Question (Penalties)
Individuals who opt out of purchasing health insurance, or fail to obtain a plan that meets minimum essential coverage, but are able to afford it, will be charged the penalty.
Coverage under the health care law is defined as any plan that meets the defined “minimum essential coverage.”
If you or your dependents fail to meet the minimum essential coverage, there are 2 ways in which the fee will be calculated for not having health coverage. You will either pay a flat fee or a percentage of your household income, whichever is higher.
In 2015 the fee calculations are as follows, and the higher of these two amounts will be assessed.
- $325 per adult ($162.50 per child under 18) not to exceed $975 per family
- 2% of your annual household income. Only the amount of income above the tax filing threshold (approx. $10,000 per individual) is used in this calculation. The maximum penalty is determined is equal to the national average premium for a bronze plan.
In 2014 the fee calculations are as follows, and the higher of these two amounts will be assessed.
- $95 per adult ($47.50 per child under 18) not to exceed $285 per family
- 1% of your annual household income. Only the amount of income above the tax filing threshold (approx. $10,000 per individual) is used in this calculation. The maximum penalty is determined is equal to the national average premium for a bronze plan.
If minimum essential coverage is not met, any of the following criteria may qualify you for an exemption from the penalty:
- The lowest-priced coverage available to you exceeds 8% of your household income
- You are uninsured for less than 3 months out of the year
- You aren’t required to file a tax return due to your level of income is too low based on the filing limit
- You are a member of a recognized health care sharing ministry
- You are a member of a recognized religious sect with religious objections to insurance, including, but not limited to Medicare and Social Security
- You are eligible for services through an Indian Health Service provider
- You are a member of a federally recognized tribe
- You are not lawfully present in the United States
- You are currently incarcerated serving a term in jail or prison (not including being detained pending disposition of charges
- You meet the qualifications for a hardship exemption
Need 2016 HealthCare Coverage? There is still time to qualify!
Paying the Fee
The fee is deducted from your federal income tax return for the year you are without coverage. Most people will file 2014 returns in early 2015 as well as their 2015 returns in early 2016.
If you are uninsured for a portion of the year, 1/12 of the yearly fee will apply to each month you do not have coverage.
Should you not pay the penalty, the IRS will hold back the amount of the fee from any future tax refunds. However, there are no levies, liens, or criminal penalties for failing to pay the fee.
Life Changing Events
Certain life changing events must be reported if you have coverage through the Marketplace, as this information may directly affect the coverage or savings that you and your family would be eligible for. These changes should be reported as soon as possible from the date the change took place.
A general rule of thumb is if the changes affect your income, or you gain or lose a member of your household, this must be reported. A failure to report these changes could result in back pay of the difference when filing your federal tax return for the coverage year.
Having a baby
All Health Insurance Marketplace and Medicaid plans cover pregnancy, regardless if your pregnancy begins before or after your coverage takes effect.
Pregnancy qualifies you for a Special Enrollment Period, often referred to as SEP. This allows you to enroll in or change Marketplace coverage after you deliver your child, even if it occurs outside of the Open Enrollment period. Once enrolled in your new plan, coverage can be effective from the date the baby was born. With an SEP, coverage will begin from the date of the childbirth, even if you fail to enroll up to 60 days after the baby is born.
If you already had coverage through the Marketplace, you have 2 options:
- You can keep the current plan in which you are enrolled and add your child to your coverage
- You can change to a different plan within the Marketplace
- Find healthcare coverage for you, your family, and your new baby that fits your needs. Get Quote Now
Pregnancy and Private Health Plans
Maternity Care and Childbirth services, inside and outside the health Insurance Marketplace are required to cover specific essential health benefits for the individuals and family. If you are pregnant prior to being enrolled into a plan, these benefits will still be covered. Furthermore, all plans that are sold outside or within the Marketplace are to provide a document of Summary of Benefits and Coverage. The summary explains how the plan covers childbirth expenses.
It is important to note that some grandfathered individual plans that are purchased independently by the individual or family (not plans offered by an employer) do not necessarily have to cover pregnancy and childbirth.
Maternity and Childbirth Services in relation to Medicaid and CHIP
Medicaid and the CHIP program cover pregnancy and childbirth for individuals and families that do not exceed a specified income threshold. Medicaid and CHIP may have different qualification income levels. Because these are state-based programs, eligibility and benefits vary from state to state.
Both programs can be applied for year-round by either filling out an application in the Marketplace, or directly through your state agency.
When getting married, you must report this life changing event. Your coverage will take effect on the first day of the month that you enroll. The enrollment window is up to 60 days after the date of your marriage. But make note that you cannot enroll until after you are married.
The Marketplace treats same-sex couples in the same way as opposite-sex couples, protected from discrimination.
One of 3 situations will arise, when your non-Marketplace grandfathered plan comes to an end:
- Your plan will be cancelled. Should this happen, you may find the option to purchase into another plan that your company offers in its place. You may otherwise, opt to purchase a new Marketplace plan with will include the new rights and protections and qualify for Special Enrollment Period due to the cancellation of your previous plan. Or you can purchase a plan outside of the Marketplace. Most of these plans will also include the new rights and protections.
- Your plan will change to include the new rights and protections. Should this situation occur, you may opt to accept the new plan and renew it. You may also look for plans inside the Marketplace for comparison. Once again, because your coverage is being changed, you will qualify for Special Enrollment Period and will be allowed to enroll in a plan outside of the open Enrollment period.
- Your insurance company offers to renew your plan without the new rights and protections. If you find yourself in this situation, you may be able to renew this grandfathered plan annually until 2016. This, however, will be decided by each state on whether to allow insurers to allow people to renew a plan that does not include the new rights and protections. These grandfathered plans are only offered to existing customers, and are not available to be purchased by new customers.
If your grandfathered plan has been changed or cancelled you can call the special cancellation customer service number to speak with a representative to explain your options at 1-877-637-0040 Monday through Friday, 9 a.m. to 7 p.m.; Saturday and Sunday, 9 a.m. to 5 p.m. ET.
How to Enroll
The Health Insurance Marketplace has put in much effort and focus to make enrollment easy and accessible for all people. Regardless of your preferred method, you will be able to fill out a Marketplace application to determine if you and your family can be qualified for a coverage that includes premium tax credits and additional savings based on your income level, or a free or low-cost plan through Medicaid or CHIP.
The 4 ways in which you and your family can apply for coverage through the Marketplace are as follows:
- Apply online- To apply online, you will be asked to set up an account. You can visit the Get Coverage page and start out by selecting your state and clicking the “Apply Now” link. Once you do this, you will be prompted to provide some basic information and set up a secure account.
- You will then be directed to fill out an application. The application process will require you to provide certain information regarding your income, current health coverage, household member information, etc.
- Once the application process is completed, you will be able to view your eligibility results and all the options for coverage that you and your family are qualified for. You will also be able to determine if you are eligible for other savings, including the premium tax credits. You may also know if you qualify for Medicaid or CHIP coverage.
- Once you review your results, you will now be prompted to enroll in the plan that you choose. You will be provided your new insurance company contact information so you can finish enrollment and make your first payment
- Apply by mail – You can send in your application by mail by filling out a paper application. As soon as you get your eligibility results, you can finish the enrollment process either online, or over the phone through the Marketplace Contact Center at 1-877-637-0040.
- Apply over the phone – If you choose, you can bypass the mailing option by completing your application and enrollment over the phone with a Marketplace Call Center Representative at 1-877-637-0040. Phone lines are open 24 hours, 7 days a week.
- Apply in person – If you prefer to apply and enroll in person, or need guidance in the processes, you can locate an assister who will sit with you and help you in this process. Along with helping you with the whole application and enrollment processes, they can answer any questions and work with you in choosing a plan that best fits your needs. Visit HealthCare.gov to locate an assister near you.