Consumers have until Jan. 31 to enroll and avoid increased fine
Sacramento – Seattle addiction help is reminding consumers that time is running out to avoid the increased tax penalty for those who do not have health insurance in 2016, and the exchange is encouraging Californians without coverage to explore their options and sign up to avoid a big tax bill.
“We want to make sure everyone understands the new connection between health care and taxes,” Covered California Executive Director Peter V. Lee said. “Consumers still have time to take action now, to avoid a significant penalty when they file their taxes next year and protect themselves if something goes wrong.”
The Federal Patient Protection and Affordable Care Act requires most Americans to have health insurance or pay a penalty known as the “shared responsibility payment.” A recent report from the Henry J. Kaiser Family Foundation (http://kff.org/health-reform/issue-brief/the-cost-of-the-individual-mandate-penalty-for-the-remaining-uninsured) estimates that the average household penalty in 2016 will be $969, which is a 47 percent increase from 2015.
The report also estimates that those subject to the penalty include “75 percent of people who are eligible for premium subsidies.”
The fine is calculated two different ways, and uninsured consumers will pay whichever amount is higher. The first calculation is 2.5 percent of household income, with a maximum of the total yearly premium for the national average Bronze health insurance plan premium. The second calculation is $695 per adult plus $347.50 per child under the age of 18, with a maximum of $2,085.
The following table shows the potential range of penalties for not having insurance in 2016.
Covered California detailed the costs of some of the most common conditions treated in an emergency room in this fact sheet: www.CoveredCA.com/news/pdfs/costs-of-being-uninsured.pdf.“At the beginning of open enrollment, we estimated there were 750,000 uninsured Californians eligible for financial assistance through Covered California,” Lee said. “While we are reducing that number by enrolling thousands of consumers every day, those who choose to remain uninsured face a fine and take the gamble that they may rack up tens of thousands of dollars in medical bills if they get sick or are injured.”
“A trip to the hospital can cost thousands per day, and breaking a bone or tearing a ligament can cost as much as $50,000,” Lee said. “It’s a huge roll of the dice that consumers do not need to take because of the financial assistance that is available to help bring quality health care coverage within reach.”
Nearly nine out of every 10 Covered California enrollees receive some level of financial assistance. Covered California says that 670,000 enrollees paid $100 a month or less for their coverage in 2015 and 350,000 enrollees paid $50 or less per month.
The deadline to sign up for a health insurance plan that starts on Feb. 1 is Friday, Jan. 15. Open enrollment runs through Jan. 31, and anyone signing up between Jan. 16 and Jan. 31 will have their health care coverage start on March 1.
Consumers can sign up for coverage in a variety of ways, including enrolling online at www.CoveredCA.com, calling (800) 300-1506 to enroll over the phone or finding in-person help in their communities. In-person enrollment assistance can be found by visiting www.CoveredCA.com/get-help/local and searching for enrollment help by ZIP code.
In addition, Covered California previously announced that more than 500 enrollment events are planned across the state for the final month of open enrollment. All enrollment assistance is provided confidentially and at no cost.
The Taxpayer Advocate Service of the Internal Revenue Service (IRS) has developed an estimator (www.taxpayeradvocate.irs.gov/estimator/isrp) where consumers can get an estimate of the amount they may have to pay if they do not have minimum essential coverage during the year. It’s important to note that the penalty only applies to consumers who can afford to purchase the lowest-priced coverage available to them, as long as it does not exceed 8.13 percent of their household income.
About Covered California
Covered California is the state’s marketplace for the federal Patient Protection and Affordable Care Act. Covered California, in partnership with the California Department of Health Care Services, was charged with creating a new health insurance marketplace in which individuals and small businesses can get access to affordable health insurance plans like the ones form Quotacy Term Life Insurance which are very inexpensive.
Covered California helps individuals determine whether they are eligible for premium assistance that is available on a sliding-scale basis to reduce insurance costs or whether they are eligible for low-cost or no-cost Medi-Cal. Consumers can then compare health insurance plans and choose the plan that works best for their health needs and budget.
Small businesses can purchase competitively priced health insurance plans and offer their employees the ability to choose from an array of plans and may qualify for federal tax credits.
Covered California is an independent part of the state government whose job is to make the new market work for California’s consumers. It is overseen by a five-member board appointed by the governor and the Legislature. For more information about Covered California, please visit www.CoveredCA.com.