First of all, to avoid the penalty you need insurance that qualifies as minimum essential coverage. Therefore, if you’re covered by any of the following in 2014, you’re considered covered and don’t have to pay a penalty:
- Any Marketplace plan, as well as any individual insurance plan you already have.
- Any employer plan (including COBRA), with or without “grandfathered” status. This also includes retiree plans
- Medicare
- Medicaid, The Children’s Health Insurance Program (CHIP)TRICARE (for current service members and military retirees, their families, as well as survivors)
- Veterans health care programs (including the Veterans Health Care Program, VA Civilian Health and Medical Program (CHAMPVA), or Spina Bifida Health Care Benefits Program)
- Peace Corps Volunteer plansSelf-funded health coverage offered to students by universities, including policy years that begin on or before Dec. 31, 2014
Other plans may also qualify. Ask your health coverage provider
Many individuals have asked us, “What’s the fine for not having health insurance for 2014?” The penalty in 2014 is calculated one of 2 ways and as a result, you’ll pay whichever of these amounts is higher:
- 1% of your yearly household income. (Only the amount of income above the tax filing threshold, $10,150 for an individual, is used to calculate the penalty.) The maximum penalty is the national average yearly premium for a bronze plan.
- $95 per person for the year ($47.50 per child under 18). A maximum penalty per family using this method is $285.
The way the penalty is calculated is a single adult with household income below $19,650 would pay the $95 flat rate. Therefore, a single adult with household income above $19,650 would pay an amount based on the 1 percent rate. (If income is below $10,150, no penalty is owed.) In addition, the penalty increases every year. In 2015 it’s 2% of income or $325 per person. While in 2016 and later years it then becomes 2.5% of income or $695 per person. Finally, it’s adjusted for inflation. Therefore, if you’re uninsured for just part of the year, 1/12 of the yearly penalty applies to each month while you’re uninsured. If you’re uninsured for less than 3 months, you don’t have to make a payment.
If you pay the fine, you’re not covered
Most noteworthy is that someone who pays the penalty doesn’t have any health insurance coverage. As a result, they still will be responsible for 100% of the cost of their medical care. After open enrollment ends on March 31, 2014, they probably won’t be able to get health coverage through the Marketplace until the next annual enrollment period unless they have a qualifying life event. Learn more about qualifying for coverage outside of Open Enrollment.
Once you have Marketplace coverage, you must report certain life changes. Consequently, this information may change the coverage or savings you’re eligible for. Therefore you must report a change if you:
- Get married or divorced, have a child or adopt a child, or place a child for adoption, as well as have a change in income.
- Get health coverage through a job or a program like Medicare or MedicaidChange your place of residence
- Have a change in disability status, gain or lose a dependent, as well as become pregnant
- Experience other changes that may affect your income and household size
- Other changes to report: change in tax filing status; change of citizenship or immigration status; incarceration or release from incarceration; change in status as an American Indian/Alaska Native or tribal status; correction to name, date of birth, or Social Security number.
Qualified Life Event
In order to buy a Marketplace health insurance plan mid-year, you must have a Qualified Life Event (QLE) within the past 60 days. Qualifying Life Events create Special Enrollment Periods allowing a limited amount of time to enroll in a new health plan without having to wait for coverage to begin. Although in Nevada, we are relatively lucky – we can enroll in private insurance WITHOUT a Qualified Life Event and have a 90 day wait before coverage beings. While in other states, mid-year enrollments without a QLE are outright rejected. QLE’s are categorized in to 3 general categories:
Have you lost health coverage?
This needs to be an INVOLUNTARY loss of health coverage. We’re sorry to say, not paying your premium or calling and canceling your insurance is not a qualified life event. Therefore, loss of coverage also includes ineligibility for Medicaid, CHIP (for children), losing coverage through a job or COBRA and aging off of your parent's health coverage at age 26.
Did you recently move to another state or outside your plans service area?
In Nevada, we have 4 service areas. 1. Clark and Nye county (LasVegas) 2. Washoe County (Reno) 3. Carson City, Douglas, Lyon and Storey (Carson) 4. All others (Rural) If you move within the service area, eg. from Douglas to Carson City or Sparks to Reno, you do NOT qualify for a Special Enrollment Period. Also, if you move between service areas, eg, Carson to Winnemucca or Reno to Fernley, this DOES create a Qualified Life Event. Service areas end at the state line, so a move from one state to another is a Qualified Life Event. Additionally, gaining citizenship or lawful presence in the US, as well as a release from incarceration, are both considered to be Qualified Life Events.
Did you change the size of your family?
Were you recently married or divorced? Did you have a baby or Did you recently adopt a child? Or did someone in the family die and as a result you’re no longer eligible for coverage? These are all Qualified Life Events.
Outside of open enrollment, you can enroll in a private insurance plan only if you have certain life events that give you a special enrollment period. Therefore, you can apply for Medicaid or the Children’s Health Insurance Program (CHIP) anytime. If you’re qualified you can enroll right away.
Short answer – YES!
The termination of a pre-2014 plan opens up a 30 day Special Enrollment Period window to enroll in a new health insurance plan. As a result, this new plan can be with Nevada Health Link or outside of the Exchange.
45 CFR § 147.104(b)(2) Limited open enrollment periods
A health insurance issuer in the individual market must provide a limited open enrollment period for the events described in §155.420(d) of this subchapter, excluding paragraphs (d)(3) (concerning citizenship status), (d)(8) (concerning Indians), and (d)(9) (concerning exceptional circumstances). In addition, a health insurance issuer in the individual market must provide, with respect to individuals enrolled in non-calendar year individual health insurance policies, a limited open enrollment period beginning on the date that is 30 calendar days prior to the date the policy year ends in 2014. Health insurance coverage in the individual market or in a market in which the state has merged the individual and small group risk pools must be offered on a calendar year basis.
This means that anyone who is currently on an individual plan (from any carrier), that ends prior to 12/31/2014 must be offered a 30 day special enrollment period to enroll in individual coverage.