What Happens If I Don’t Have Health Coverage in 2014?

This is important: Since October 1st, more than 1.2 million Americans are poised to gain coverage under Obamacare — and more are picking plans every day. Now, the deadline is coming up to get coverage from the Marketplace in time for the new year. You have until December 23rd to select a plan in order for your health insurance to start by January 1st. So, if you have not done so already, be sure to either visit healthcare.gov or connect with a local insurance broker in your area and find out what type of health insurance is best for you and your family. Your insurance coverage must meet the minimum essential coverage requirement. This refers to the type of coverage an individual needs to have to meet the individual responsibility requirement under the Affordable Care Act. This includes individual market policies, job-based coverage, Medicare, Medicaid, CHIP, TRICARE and certain other coverage.

If someone does not have coverage in 2014, they may have to pay a fee, in addition to all of their health care expenses.This fee is referred to as the “individual responsibility payment,” “individual mandate,” or penalty. The penalty in 2014 is calculated one of two ways (you pay whichever cost is higher):

1. 1% of your yearly household income. The maximum penalty is the national average yearly premium for a bronze plan.
2. $95 per person for the year ($47.50 per child under 18). The maximum penalty per family using this method is $285.

In 2015 the fee increases to 2% of income or $325 per person. In 2016 and later years it is 2.5% of income or $695 per person. It is adjusted for inflation the years to follow.

But what happens if you are insured for just part of the year? 1/12 of the yearly penalty applies to each month you’re uninsured. However, those who are uninsured for less than 3 months do not have to make a payment.

Some people with limited incomes and other situations can get exemptions from the fee. Learn about exemptions from paying the fee.

To read more about the individual responsibility payment, click here.

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