Five Myths about the Affordable Care Act

There is a lot of confusion surrounding the Affordable Care Act (ACA).  Here are some myths, and the truths behind them:

MYTH #1:  I must purchase my health insurance on my state’s exchange (or the federal exchange in states like Virginia who are not running their own exchange).

TRUTH:  You only must purchase your health insurance on the exchange if you are eligible for and wish to collect a subsidy on your premiums.  Click here to see if you may be eligible.  If you are not eligible for a subsidy, you may purchase ACA-compliant health insurance from a licensed broker like Virginia Medical Plans.  Click on the buttons to the right or call our office 1-800-867-0800 for an instant quote.

If you are eligible for a subsidy, click here for detailed instructions on using the federal exchange (Virginia residents).  Maryland and DC residents click here.

MYTH #2:  It is cheaper to buy health insurance on the exchange.

TRUTH:  Unless you are eligible for a subsidy, insurance purchased on the exchange is not necessarily less expensive.  Furthermore, our experience is that the plans offered through the exchange tend to be more limited, whereas the plans offered off-exchange are more broad in terms of features and benefits.  Give us a call or click on the buttons to the right for instant quotes!

MYTH #3:  I don’t need to purchase insurance now; I can wait until I get sick.

TRUTH:  Open enrollment for 2014 coverage runs through March 31, 2014.  After that date, you will not have another opportunity to purchase 2014 coverage unless you have a qualifying event like a change in employment or marital status, the birth or adoption of a child, etc.  If you get sick on April 1 or later and have not yet enrolled in a plan, you will be on your own until 2015.  We can’t stress enough the importance of enrolling now!

MYTH #4:  The law has been delayed since the online website had so many problems.

TRUTH:  While certain deadlines surrounding ACA were extended, the individual mandate — the requirement for most Americans to have coverage by January 1, 2014 — did not change.  Likewise, the final date of open enrollment remains March 31, 2014.  You MUST enroll in coverage by March 31 to avoid the penalty tax.

MYTH #5:  It costs more money to buy health insurance through a broker.

TRUTH:  There is absolutely no cost to you when you use the services of a licensed broker to select and enroll in health insurance — on or off the exchange.  And when a broker helps you, you get the benefit of that assistance for the life of your policy to help with claims issues, administrative questions, policy changes, etc.

Don’t leave yourself and your family exposed.  Get coverage for 2014 and do it today!  Call our office 1-800-867-0800 or send us an email jkatz@vamedicalplans.com.

Please be patient as we manage a high volume of calls and emails.

How Much Penalty Will I Pay if I Don’t Get Health Insurance?

The individual responsibility clause of the Affordable Care Act (ACA), also known as the individual mandate, requires all Americans to have health insurance by January 1, 2014, or pay a penalty tax.

How Much Will the Penalty Be for not Having Health Insurance?

You may have heard the figure $95 per person.  That is the basic penalty in 2014 for an unmarried individual, earning less than $19,500/year, with no dependents.

If you don’t fit that category, the penalty — which is actually not a penalty, but a tax — is a bit more complicated.

How the Penalty Works

YEAR	PENALTY WILL BE THE GREATER OF:
2014	$95 per adult plus half that amount per child under 18, based on the number of uninsured people in your household, capped at 3x adult rate = $285; or 1% of your adjusted gross income (capped at the cost of a bronze plan available through the exchange).
2015	$325 per adult plus half that amount per child under 18, based on the number of uninsured people in your household, capped at 3x adult rate = $975; or  2% of your adjusted gross income (capped at the cost of a bronze plan available through the exchange).
2016	$695 per adult plus half that amount per child under 18, based on the number of uninsured people in your household, capped at 3x adult rate = $2085; or  2.5% of your adjusted gross income (capped at the cost of a bronze plan available through the exchange).
2017 and beyond	Penalty will be increased annually by cost of living

Notice that wealthier households will pay a percent of income rather than a flat amount.  For example: in 2016, an individual earning below $37,000 would pay $695 (flat-dollar calculation) while an individual earning $200,000 would pay $5,000 (2.5% of income).

The reason we say the penalty is actually a tax is that it will be assessed on your income tax return.  This means it will be added to any amount of tax you owe, and deducted from any refund amount you are due.

Calculate Your Penalty Amount

We found a quick and easy calculator you can use to check the 2014 penalty.  Check it out.

Purchase Health Insurance for all Family Members

Before you think about just paying the penalty, keep in mind that having health insurance is about more than paying a premium.  It is about safeguarding yourself and your family from what can happen without access to medical care.

Exceptions

The simplest way to avoid paying the penalty tax is to purchase health insurance for yourself and other members of your household!

There are a few other exceptions:

• You are part of a religion opposed to acceptance of benefits from a health insurance policy.
• You are an undocumented immigrant.
• You are incarcerated.
• You are a member of certain Native American tribes.
• Your family income is below the threshold requiring you to file a tax return ($9,350 for an individual in 2010; $18,700 for a family in 2010).
• You have to pay more than 8% of your income for health insurance, after taking into account any employer contributions or tax credits.
• You have a gap in coverage for less than a continuous three-month period (this exemption may only be used for one period without coverage in a year).

Virginia Medical Plans can help you avoid the penalty and get health insurance for yourself and/or your family.

Call our office so that we can find the right coverage at the right price for you!

Please be patient as we manage a high volume of calls and emails.

Extended Deadline for Health Coverage – What Does it Mean?

The Affordable Care Act (ACA — otherwise known as “Obamacare”) has been front-and-center in the news this month, first for its role in the recent record-long, 16-day shutdown of the US government, and now for the technical glitches that have plagued the online federal health insurance exchange since it opened on October 1.

This week the Obama administration announced a 6-week extension of the deadline for signing up for health coverage.

What exactly does this mean?

The extended deadline means that consumers will not be taxed for not having coverage, as long as they sign up by March 31, 2014.  Originally, that date was February 15, 2014.

We should point out — the requirement for most Americans to have health insurance by January 1, 2014 (known as the individual mandate) has not been delayed.

What the extension does do is allow anyone who purchases coverage during the entire open enrollment period (October 1, 2013 through March 31, 2014) to not face a penalty tax for the time after January 1 that they may have spent uncovered.

Really not much of a change!

Thank you for your patience as we continue to experience a large volume of calls and emails!

What Happens if I Do Not Have Health Insurance after January 1 2014?

The individual responsibility clause of the Affordable Care Act (ACA), also known as the individual mandate, requires all Americans to have  health insurance by January 1, 2014, or pay a penalty tax.

How will the Penalty Tax be Collected?

The penalty tax will be collected by the Internal Revenue Service (IRS).  When you file your taxes, if you have a gap in health coverage for a continuous three-months or more during the previous year, the IRS will take the penalty.  The penalty amount will be prorated for the number of months of no coverage.

How will the Penalty Tax be Calculated?

In 2014:  $95 per adult and $47.50 per child (up to $285 per family) OR 1.0% of family income, whichever is greater.

In 2015:  $325 per adult and $162.50 per child (up to $975 per family) OR 2.0% of family income, whichever is greater.

In 2016 and beyond:  $695 per adult and $347.50 per child (up to $2085 per family) OR 2.5% of family income, whichever is greater.  After 2016, penalty amounts will be increased annually by the cost of living.

Is There Any Way to Avoid the Penalty Tax?

The best way to avoid the penalty tax is to purchase health insurance by January 1, 2014!  There are a few exceptions:

• You are part of a religion opposed to acceptance of benefits from a health insurance policy.
• You are an undocumented immigrant.
• You are incarcerated.
• You are a member of certain Native American tribes.
• Your family income is below the threshold requiring you to file a tax return ($9,350 for an individual in 2010; $18,700 for a family in 2010).
• You have to pay more than 8% of your income for health insurance, after taking into account any employer contributions or tax credits.
• You have a gap in coverage for less than a continuous three-month period (this exemption may only be used for one period without coverage in a year).

The right health care coverage, at the right price, is out there for everyone, and we can help you find it!  Don’t pay a tax penalty!

Make sure you and everyone in your family is covered under an ACA-compliant health plan by January 1, 2014!  Open enrollment for health coverage starts on October 1, 2013.

Give our office a call!