Each year will be different with respect to the requirements of the Affordable Health Care Act. That being said in 2014 certain choices will need to be made by individuals or families. Compare Health Insurance Agency would like to give a brief overview of pertinent penalties or insurance coverage that needs to be met.
First, all individuals or families need to either have a employer group sponsored plan, individual coverage inside or out of the california health insurance exchange or pay a penalty for the 2014 calendar year. The penalty for the 2014 year is a modest $95.00 or 1% of the modified adjusted gross income whichever is higher for each individual. The penalty can't exceed the average annual premium for the silver level bronze plan in the particular state of the resident.
We don't mean to get too complicated but suffice it to say the penalties will be extremely modest for the 1st year for either an individual or family but will be raised annually. We assume this is to make the healthcare reform more popular among certain groups who have been vocal about their oppostion to the reform. We are not up to date on how penalties will be collected or enforced and don't want to guess on these tax or IRS issues since we health insurance brokers and not tax advisors.
Individual health coverage both inside and outside of the exchange will obviously be more expensive than any penalty levied upon an individual or family. The essential question for any person purchasing insurance is whether they will qualify for a subsidy which will make the coverage less expensive inside the exchange assuming all plans are equal.
Qualifications for subsidies within the california health insurance exchange are tp be a u.s. citizen, income from 133% to 400% of federal poverty level. The income levels for an individual would be 14,856 to 44,680 and for a family of four from 30,656 to 92,200 for 2013 although coverage would start January 1, 2014.
Premium credits are available for any level plan which include platinum, gold, silver and bronze. Depending on your income level their will be cost sharing subsidies up to 250% of the federal poverty level on only silver level plans.
Additional information will be presented on group and business plans in upcoming blog posts.
