What type of Insurance do you need?

The Patient Protection and Affordable Care Act (PPACA) commonly called the Affordable Care Act (ACA) or colloquially "ObamaCare" was enacted to increase the quality and affordability of health insurance, lower the uninsured rate by expanding public and private insurance coverage, and reduce the costs of healthcare for individuals and the government. It introduced mechanisms like mandates, subsidies, and insurance exchanges. The law requires insurance companies to cover all applicants within new minimum standards and offer the same rates regardless of pre-existing conditions or sex. In 2011 the Congressional Budget Office projected that the ACA would lower both future deficits and Medicare spending.[1]

2017 hardship exemptions

In addition to the exemptions above, you may qualify for a “hardship” exemption for 2017.

Hardships are life situations that keep you from getting health insurance.To claim a hardship exemption, you must fill out a paper application and mail it in to the Marketplace. 

Hardships that qualify you for exemptions include:

  • You were homeless
  • You were evicted in the past 6 months or were facing eviction or foreclosure
  • You received a shut-off notice from a utility company
  • You recently experienced domestic violence
  • You recently experienced the death of a close family member
  • You experienced a fire, flood, or other natural or human-caused disaster that caused substantial damage to your property
  • You filed for bankruptcy in the last 6 months
  • You had medical expenses you couldn’t pay in the last 24 months that resulted in substantial debt
  • You experienced unexpected increases in necessary expenses due to caring for an ill, disabled, or aging family member
  • As a result of an eligibility appeals decision, you’re eligible for enrollment in a qualified health plan (QHP) through the Marketplace, lower costs on your monthly premiums, or cost-sharing reductions for a time period when you weren’t enrolled in a QHP through the Marketplace
  • You were determined ineligible for Medicaid because your state didn’t expand eligibility for Medicaid under the Affordable Care Act
  • Your individual insurance plan was cancelled and you believe other Marketplace plans are unaffordable.
  • You expect to claim a child as a tax dependent who’s been denied coverage for Medicaid and CHIP for 2016, and another person is required by court order to give medical support to the child. In this case you don’t have to pay the penalty for the child. [2] 

If you can afford health insurance but choose not to buy it, you must have a health coverage exemption or pay a fee. (The fee is sometimes called the "penalty," "fine," "individual responsibility payment," or "individual mandate.") The fee is calculated 2 different ways – as a percentage of your household income, and per person. You’ll pay whichever is higher.

Percentage of income

  • 2.5% of household income
  • Maximum: Total yearly premium for the national average price of a Bronze plan sold through the Marketplace

Per person

  • $695 per adult
  • $347.50 per child under 18
  • Maximum: $2,085

After 2017 the tax rate will stay the same but the flat fee will adjust with inflation.

[1] http://en.wikipedia.org/wiki/Patient_Protection_and_Affordable_Care_Act#Healthcare_cost_inflation

[2] https://www.healthcare.gov/health-coverage-exemptions/hardship-exemptions/

[3] https://www.healthcare.gov/health-coverage-exemptions/forms-how-to-apply/

The Affordable Care Act helps to reform the healthcare system by giving more Americans access to quality, affordable health insurance and helps to curb the growth of healthcare spending in the U.S.

All Americans with health insurance will have access to a number of new benefits, rights, and protections which ensure that they can get treatment when they need it.

It makes insurance more affordable by reducing premium and out-of-pocket costs for tens of millions of families and small business owners who had been priced out of coverage in the past. This helps over 32 million Americans afford health care that could not get it before. It also makes coverage more affordable for many more. Under the plan, 95% of Americans will be insured. 

The law spreads risk equally to all insured to end discrimination. (see question 1) In the past you could be discriminated based on gender or health status, or costs could differ wildly due to factors like age. The ACA limits discrepancies in what you can be charged and in order to do this requires all Americans who can afford to maintain Minimum Essential Coverage starting in 2014. Many who can’t afford coverage will be exempt from the requirement to maintain coverage. Exemptions are listed below.

It sets up a new competitive health insurance marketplace giving tens of millions of Americans access to group buying power and allowing them to compare plans and receive cost assistance. (see questions 2 & 3)

Commonly asked questions:

What ObamaCare did

1. Why are premiums higher before tax credits?

Most health insurance premiums were low before the ACA. This was because they were selective about who they insured.  After the ACA became effective, insurance companies had to raise premiums because they had to accept everyone. If Premiums were not raised, there would have been no money to pay out all the new claims.

​2. What are the subsidies (tax credits)?

A subsidy is a sum of money granted by the government or a public body to assist an industry or business so that the price of a commodity or service may remain low or competitive, by definition. They only way to get help paying for healthcare by getting a subsidy through the government is by going through the marketplace or “exchange”. There you will fill out a questionnaire that will tell you how much of a subsidy you are entitled to. For most people the price of health insurance would be a lot less than it would have been before the ACA became effective. 

3. What is "cost sharing reductions"?

Subsidies that discount people's out-of-pocket costs for deductible, co-pays and co-insurance. These credits are more limited than the premium subsidies – they’re only available to people purchasing mid-level “silver” health plans who earn under 250 percent of the federal poverty level, or $29,425 for an individual. This cost-sharing reduction could slash out-of-pocket costs by as much as 94 percent for the lowest-income individuals. The reductions are automatically applied, so consumers may not even realize that they’re receiving the aid.





There are different kinds of exemptions. Some you claim on your federal tax return. Others, including hardship exemptions, you apply for with a paper application.

If you’re covered by a plan that qualifies as “minimum essential coverage” you don’t need to pay the fee or get an exemption.
Below are all exemptions for the 2017 tax year.

Income-related exemptions
The lowest-priced coverage available to you, through either a Marketplace or job-based plan, would cost more than 8.13% of your household income
You don’t have to file a tax return because your income is below the level that requires you to file

Health coverage-related exemptions
You were uninsured for no more than 2 consecutive months of the year
You lived in a state that didn’t expand its Medicaid program but you would have qualified if it had

Group membership exemptions
You’re a member of a federally recognized tribe or eligible for services through an Indian Health Services provider
You’re a member of a recognized health care sharing ministry
You’re a member of a recognized religious sect with religious objections to insurance, including Social Security and Medicare.

Other exemptions
You’re incarcerated (serving a term in prison or jail)
You’re a U.S. citizen living abroad, a certain type of non-citizen, or not lawfully present. [3]

​You experiences one of the hardships to the right. 

exemptions you may qualify for

The affordable care act and what it does for you.

penalties for not having it

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