Health Insurance in the Age of Healthcare Reform – Am I Covered?

by Ruben Reyes

Under the Patient Protection and Affordable Care Act (PPACA) the individual shared responsibility provision, as referred to as the “individual mandate”, requires you, your spouse, and your dependents to have qualifying health insurance for the entire year, report a health coverage exemption, or make a payment when you file your tax returns.

What is qualifying health insurance?

Qualifying health insurance is defined as Minimum Essential Coverage (MEC) and includes:

• Most health insurance coverage provided by your employer; 
• Coverage provided under a government-sponsored program – including Medicare, Medicaid, and health care programs for veterans;
• Health insurance purchased directly from an insurance company;
• Other health insurance coverage that is recognized by the Department of HHS as MEC; and
• Health insurance purchased through the Marketplace

Will I be eligible for any premium assistance to help pay for my coverage?

You may be eligible for the premium tax credit if you purchase health coverage through the Health Insurance Marketplace. For example, if you are not eligible for minimum essential coverage that provides minimum value and is considered affordable (self-only coverage is less than 9.5% of your W-2 wages), through your employer, you may be eligible for premium assistance.

When can I sign up for health coverage through the Health Insurance Marketplace?

The Marketplace annual open enrollment begins November 1, 2015, and continues through January 31, 2016. If you experience a special status change event outside of the open enrollment period (for example, you lose your coverage through your employer), you will be eligible to enroll through a special enrollment.

What if I choose not to have qualifying health insurance?

In 2015, the annual penalty is the greater of:

• $325 for each adult and $162.50 for each child, up to $975 per family.
• 2 percent of the tax filer’s annual household income minus the federal tax-filing threshold.

In 2016 and beyond, the annual penalty is the greater of (for later years, the penalty will be indexed based on the cost of living):

• $695 for each adult and $347.50 for each child, up to $2,085 per family.
• 2.5 percent of the tax filer’s annual household income minus the federal tax filing threshold.

Note: The penalty will be capped at the national average premium for the lowest-cost Bronze plan available through all of the marketplaces.

Where can I find health insurance options for me and my family?

The State Bar of California sponsored Healthcare Program helps California lawyers gain access to qualifying health coverage. The program connects solo practitioners and firms of all sizes with sponsored Broker Administrators who can assist State Bar members and their families to obtain quality health insurance products and to do so conveniently. Visit CalBarConnect.Com for additional information.

Ruben Reyes is Chair Emeritus of the State Bar Committee on Group Insurance Programs. He is Assistant Vice President, Compliance Counsel for Arthur J. Gallagher and has over 12 years of employee benefits and ERISA experience working with both public and private sector employers.