PPACA-The Individual Mandate

The Patient Protection and Affordable Care Act (PPACA) basically provides that as of the 1st January, 2014 all US residents are required to have “minimum essential” health insurance failing which they will pay a penalty (subject to certain exemptions).

Individual mandate enrollment penalty-delayed!

The government has granted a six-week extension until March 31 2014 for Americans to sign up for coverage next year and avoid new tax penalties under the president’s health care overhaul law.
Under the latest policy change, people who sign up by the end of open enrollment season on March 31 will not face a penalty. Previously you had to sign up by the middle of February, guaranteeing that your coverage would take effect March 1, in order to avoid fines for being uninsured.
The extension — granted for 2014 only — addresses confusion that was created when the administration set the first open enrollment period under the law from Oct. 1, 2013 -March 31,2014.
Health insurance coverage typically starts on the first day of a given month, and it takes up to 15 days to process applications. So somebody signing up March 16 2014 — well within the open enrollment period — wouldn’t get coverage until April 1, thereby risking a penalty for being uninsured part of the year.
As a result, the department is creating a special one-time hardship exemption for people who get covered by March 31,22014.

Because the vast majority of people will already have qualifying health insurance, few will confront the choice of buying a plan or paying a penalty. Moreover, you won’t have to pay it if you make too little money to file a federal tax return or would have to spend more than 8 percent of your household income on the cheapest qualifying plan, even including subsidies. Americans living abroad, and those in prisons, are exempt from the mandate and associated fines.

Individual subsidies.

Afraid you won’t be able to afford insurance? If you buy on a marketplace(exchange) as an individual or for a family, you may qualify for a subsidy in the form of an advance tax credit if your household income is between 100% and 400% of the federal poverty line(FPL). (The tax system already subsidizes people who have coverage through a job by excluding the cost of their health plan from income taxes.) While those with less than 250% (FPL) will also get subsidies to reduce their out of pocket costs such as deductibles, copayments and coinsurance.

These tax subsidies will cap the cost of health insurance at 2% to 9.5% of household income, if the household income is up to 400% above the FPL.

HOWEVER, individuals are only eligible for tax subsidies if they are NOT offered qualified, affordable group health insurance through an employer

Here is a calculator from the Kaiser Family Foundation to let you know an estimate of what the tax credit for the premium may be if you applied for health insurance coverage on the marketplace/exchange.

If an applicable individual does not maintain minimum essential coverage for 1 or more months during a tax year, then they must pay a penalty.

The size of the penalty is phased-in over three years:
• In 2014, the penalty will be $95 per person up to a maximum of three times that amount for a family ($285) or 1% of household income if greater
• In 2015, the penalty will be $325 per person up to a maximum of three times that amount for a family ($975) or 2% of household income if greater
• In 2016, the penalty will be $695 per person per year up to a maximum of three times that amount for a family ($2,085) or 2.5% of household income if greater

PPACA also required the creation of state/federal based marketplaces ( American Health Benefit Exchanges) through which individuals/families can purchase coverage and also a Small Business Health Options Program (SHOP) Exchange through which small businesses can purchase health insurance coverage.

For Individuals /Families the following alternatives constitute “minimum essential” coverage which will stop the payment of any penalties:
:Employer-sponsored coverage (including COBRA coverage and retiree coverage).
:Coverage purchased in the individual market
:Medicare Part A coverage
:Medicaid coverage/(AZ-AHCCCS)
:Children’s Health Insurance Program (CHIP) coverage
:Certain types of Veteran health coverage
:TRICARE

Also, anyone with existing coverage meets that mandatory requirement PROVIDED that it was in place 3/23/2010 when PPACA became law as it is regarded as “grandfathered”.It does not matter if the plans do not meet the “Essential Elements” requirement of the PPACA based plans nor that they may be unaffordable.

So they do not have to do anything at this time or the 1/1/14 because of the grandfathered status.

As of 1st October, 2013 through 3/31/2014 ( Enrollment Period) the health insurance marketplaces will offer Qualified Health Plans (QHPs) that are the same high-quality health plans available on the private market today.
These QHPs will provide the essential levels of coverage and comply with consumer protections set forth in the Affordable Care Act and will include a “catastrophic coverage” designed for people aged up to 30.

There will be people to assist the public to use the marketplaces called “navigators” but they are not qualified or licensed insurance agents/brokers and cannot advise anyone as to the suitability or otherwise of any healthcare insurance plan/coverage!!

For further information including cost/premium estimates contact:

Eric Walters.
Eric Walters Insurance Services,
TeL: (480)-657-8595
FaX: (888)-739-0796
CELL: (602)-616-1660/ Email: ewinsurance@gmail.com / Eric’s WEB site

REMEMBER- the Health Insurance Marketplaces ( the Exchanges) opened October 1, 2013 for enrollment through March 31st 2014 and anyone can use a qualified insurance agent/broker who is authorised to use the marketplaces by CMS to assist them AT NO COST!!.

Eric’s web site

Get your individual/family coverage/quote now: healthcare.gov

Don’t forget to ADD our FMM ID-EWALTERS37 and our NPN- 8594684 when setting up to your account!

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