Is everyone required to have health insurance? Will you get fined if you don’t have a plan? This page provides an overview of health mandates across the country. use it as a resource to understand when and where health insurance is required, as well as the penalties you could face if you don’t meet the coverage criteria.
If you live in a state where health insurance is required (or you’re just planning to buy health insurance for the many benefits it offers), make sure you choose a reliable insurance company that puts patients first. When you need to use health care services, the right provider will be able to offer you the right coverage and access to the health care services you need to maintain your physical and mental well-being.
- what is the individual mandate?
- Is there a penalty for not having the minimum essential coverage?
- state health insurance mandates
- How do I avoid paying a mandatory penalty for not having health insurance?
- exemptions from individual health insurance requirements
what is the individual mandate?
The introduction of the Affordable Care Act (ACA) (sometimes referred to as “Obamacare”) introduced a “Shared Responsibility Payment”. It required people to purchase health care coverage that met minimum essential coverage (MEC) standards. If the person was not covered by such a plan, that person would face a fine in the form of a tax penalty. the exception to this rule was if the individual received an exemption.
Is there a penalty for not having the minimum essential coverage?
There is no longer any federal penalty for not having a health care plan that meets minimum essential coverage standards. Technically, the provision still exists in the ACA, but the IRS tax penalty was removed for tax year 2018 and beyond due to the Tax Cuts and Jobs Act of 2017.
Although there is no federal application of the individual mandate, certain states have taken it upon themselves to implement their own individual mandates for a variety of reasons. If you reside in one of the states listed below, you can still face a penalty if you don’t have a plan that meets your state’s criteria for minimum essential coverage.
state health insurance mandates
the massachusetts insurance mandate applies to ma residents and persons who become a massachusetts resident within 63 days and who are 18 years of age or older. it applies to everyone who meets that criteria, regardless of whether or not they file taxes. Penalties for noncompliance vary based on household income, age, and family size. learn more about the ma individual mandate at mass.gov.
the new jersey individual mandate applies to those who plan to file new jersey income tax returns. For more information on the mandate, click here. To see the penalties for not having insurance, click here.
See also: What Is SR-50 Insurance?
vermont asks residents about their health insurance policies on tax return forms and encourages all residents to obtain health insurance in accordance with the provision found in the aca. Currently, there is no cash penalty for non-compliance in vt.
Like most of the other states listed, California’s individual mandate requires individuals to obtain an eligible health insurance plan, receive an exemption, or pay a penalty when filing a state income tax return. Click here to estimate your penalty for non-compliance. california cover provides detailed resources on the individual ca mandate.
The Rhode Island Individual Mandate is effective January 1, 2020. Unless an individual is specifically exempt from the mandate, they must choose between obtaining eligible health coverage and paying a penalty. For more information, visit ri.gov. To calculate the amount you could pay as a penalty, click here.
district of columbia (washington dc)
washington dc also follows in the footsteps of the aca federal individual mandate and requires its residents to obtain a plan with minimum essential coverage or pay a penalty. to find coverage, click here. To find out the penalties you will face for non-compliance, click here. Generally, the maximum penalty amount you will pay is $695 per adult and $347.50 per child, up to $2,085 per family, or 2.5% of family income over the federal tax filing threshold, which make it older.
How do I avoid paying a mandatory fine for not having health insurance?
Individual state mandates allow you to incur a penalty through reduced state tax credits. Make sure you are fully covered throughout the year by understanding the different enrollment periods explained below.
open enrollment period
Open Enrollment is a part of the year when you can enroll in or change your health care plan. for 2021, the open enrollment period is from Monday, November 1, 2021 to Saturday, January 15, 2022.
Be sure to consider all of your potential health plans and sign up for one at the end of the open enrollment period to guarantee coverage for the following year and avoid paying penalties.
special enrollment period
In certain cases, you can adjust your health care plan throughout the year if special circumstances arise, for example, if you get married. For more information on how to qualify for the Special Enrollment Period, click here. changing your health plan outside of the special enrollment period may result in a gap in coverage and a subsequent penalty from your state.
exemptions from individual health insurance requirements
Some people may not face a penalty for not enrolling in a health insurance plan if certain criteria are met and proper documentation is received by the state government. the various types of coverage exemptions are detailed below. States sometimes require individuals to submit waivers for approval by a certain date in order to be eligible for a waiver for the following year. Use the links provided in the previous section on state health insurance mandates to find relevant exemption information for your state.
religious conscience exemption
if you are a member of an approved religious sect or division that is against accepting public health benefits, or if you rely solely on a religious method of healing and accepting medical health services is against your religious beliefs, You may qualify for a religious conscience exemption. click here to know more.
The hardship exemption used to be for people who couldn’t afford health insurance due to life circumstances like homelessness. Now that the federal mandate has been removed, hardship exemptions apply to people age 30 and older who want to purchase catastrophic health plans. Catastrophic plans provide even less coverage than bronze plans, which, for people over 30, is typically the lowest level of health care plans that qualify for minimum essential coverage. In other words, a hardship waiver can sometimes allow you to enroll in a plan that doesn’t meet the usual required standards, but it’s not a full waiver.
short-term coverage gap
Some states allow people to receive exemptions from one to three months for themselves or their dependent family members. If this exemption form is filed correctly, you can choose not to be covered for a small portion of the year for any reason and still avoid paying a penalty.
part of a federally recognized Native American tribe
The federal mandate allowed American Indians and Alaskan Natives to apply for exemptions based on their special status. Today, some states, such as New York, do not offer the same type of exemption, but have special arrangements and subsidies for health services for these specific groups of people.
In most states, you don’t need to have health insurance and you won’t face a penalty if you don’t. this is because the individual mandate is repealed at the federal level. however, some states have implemented their own individual mandates. If you live in one of these states and do not have an exemption, you may be required to pay a penalty, usually in the form of a tax penalty. If you live in a state that requires health insurance but don’t want to enroll in a plan, see if you qualify for an exemption to avoid the tax penalty.
If you choose to get health insurance, make sure you choose a health insurance company that takes a convenient, digital-first approach. With easy access to health care services and simple management of your plan, you can visit the doctors and specialists you need, when you need them, without unnecessary hassle on your part.
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