The health insurance world can be a confusing place. Make no mistake about it – it’s easy to slip up and confuse coverage options, exemptions, premiums, and more. Luckily, we’re here to help you find perfect coverage and stay covered.
For some individuals, a health coverage exemption can be granted. Certain people and families are not required to carry a health insurance policy, which goes against the mandates of the Affordable Care Act.
Health Insurance Requirements
The Affordable Care Act, also known as Obamacare, stipulates that every individual must carry a qualifying health insurance policy or they will face fines from the IRS. Health insurance is no longer optional in the United States if you can afford a policy.
The Potential Penalties
While the government isn’t throwing individuals who don’t have health insurance in jail, there are penalties for not carrying health insurance throughout the year. If you can afford health insurance, but do not carry a policy – you will be issued a fine or fee by the IRS when tax season is upon us.
Now, these fees change each and every year, but they’re continually rising. For 2016 and 2017, the individual mandate or fee for not having insurance is calculated using one of the four methods below:
2.5% of your household income
● A total of the average national year premium for a bronze plan sold on the exchange
● Per person: $695 per adult and $347.50 per child under 18
● Per person maximum of $2,085
It’s important to note that you do not get to choose how your fine is calculated. You’ll be forced to pay the higher amount, but the maximum seems to hover around $2,000 – no matter your income level.
Do You Qualify For Health Care Exemptions?
The only individuals who can avoid the individual mandate and not carry health insurance qualify for one of many exemptions. Do you qualify for a health care exemption? If you’re wondering whether you’re forced to have health insurance or not, a list of exemptions can be found below:
If you’ve faced financial hardships or other situations, then you will not have to pay a fine on your taxes. Situations that qualify as hardships include eviction, homelessness, domestic violence, utilities turned off, bankruptcy, natural disasters, and more.
Income issues are the most common exemption granted. First, if you don’t have to file taxes because your income does not require tax filing, then you do not have to have medical insurance. If your household income is low enough that the lowest coverage available to you is more than 8% of your total income, you do not need to pay a fine for not having insurance.
Health Coverage Exemptions
If you were only without coverage for two months or less, then you will not be fined by the IRS. You’re also exempt from the ACA requirement if the state you live in didn’t expand their Medicaid program along federal guidelines and your income is below the poverty line. These kinds of exemptions are somewhat rare.
Health cost sharing programs have increased in popularity ever since Obamacare was instituted. You’re exempt from the ACA if you’re a member of a health care sharing ministry. You’re also exempt if you’re a member of a tribe or eligible for Indian Health Services. Certain religious sects are also exempt.
If you have been incarcerated in a prison or jail, then you are exempt from carrying health insurance for the time you are incarcerated.
Certain individuals living abroad are exempt from the Affordable Care Act mandate and not forced to carry coverage. Some people are considered not lawfully present, and as such, do not have to carry health insurance.
If a family member dies and you experience some hardships, then you can be exempt from coverage during the month before and after the passing. It’s important to note that this exemption cannot be used unless you qualify for another exemption, too.
How to Receive Exemptions?
Certain exemptions are available in the health marketplace. Other exemptions can only be granted by the IRS. This usually depends on where you live and what type of exemption you qualify for.
Am I Eligible For a Health Coverage Exemption?
The Affordable Care Act can be confusing. Health care exemptions are available to many Americans, but most individuals need to do further research before claiming their exemption and avoiding the individual mandate fine.
Each state is different, along with your individual situation. If you believe you’re exempt from paying for health insurance, do your research and find out if you qualify. You can start with the information above or If you have any questions or need assistance call 1 800-793-3803 now to speak to one of our agents.