10 Facts About Health Insurance: Facts About Health Care Reform
Health Care Reform Myth #1: Everyone automatically qualifies for subsidies under Health Care Reform. FALSE!
Health Insurance Fact #1: You may make TOO MUCH or even TOO LITTLE to qualify for health insurance premium subsidies.
Many who enroll in Affordable Care Act insurance will be eligible to receive a federal subsidy to help pay for part of the cost of their health insurance premiums; however not everyone will qualify. In some cases, those who do not qualify for health insurance premium subsidies may have incomes that are too high (above 400% of the federal poverty level). In other cases, those who do not qualify may actually have incomes that are too low (below 100% of the federal poverty level).
The Affordable Care Act (ACA) offers financial assistance in the form of advanced premium tax credits to certain U.S. citizens, and those legally present in the U.S., to help them afford the expense of insurance premiums under The Affordable Care Act. These advanced premium tax credits are only made available to qualified Affordable Care Act insurance applicants whose individual or family incomes are between 100% and 400% of the federal poverty level.
If your income is above 400% of the federal poverty level: If your individual or family income is above 400% of the federal poverty level, you may enroll in Affordable Care Act insurance but will not be eligible for federal subsidy assistance.
If your income is below 100% of the federal poverty level: In most states, those who earn below 100% of the federal poverty level will qualify for coverage under Medicaid, thanks to the newly expanded Medicaid provisions under Health Care Reform. However, not all states, including North Carolina, opted to expand their Medicaid programs.
In those states that did not expand Medicaid, it is possible that some people may earn too much to qualify for Medicaid but too little to qualify for an advanced premium tax credit under Health Care Reform. If you would have been eligible for Medicaid if your state expanded the program, but your state chose not to, you will not be required to pay a penalty if you remain uninsured.
Health Care Reform Myth #2: My employer’s family health plan must meet the Affordable Care Act’s (ACA) guidelines for affordability. FALSE!
Health Insurance Fact #2: Affordability of job-based coverage is determined by the cost to cover only the employee, NOT a spouse or dependent.
Under the Affordable Care Act (ACA), health insurance provided by an employer must not exceed 9.5% of the employee’s gross income to be considered affordable. However, this guideline only applies to the cost to cover the employee. If you are married and/or have children, the cost to cover additional family members beyond yourself under your employer’s health plan may exceed 9.5% of your gross income without violating ACA affordability guidelines.
Health Care Reform Myth #3: If I’m unhappy with my employer’s ACA compliant coverage, I or my family can switch to an Affordable Care Act insurance plan and get subsidies. FALSE!
Health Insurance Fact #3: If your employer offers health coverage that is compliant with the Affordable Care Act (ACA) and the premium costs less than 9.5% of your gross income JUST TO COVER YOURSELF, you may switch to a plan offered under The Affordable Care Act, but you, your spouse and/or your dependents will NOT qualify for federal health insurance premium subsidies.
If your job-based health insurance is compliant with the Affordable Care Act’s minimum essential benefits, minimum essential value and affordability requirements, you will not receive any advanced premium tax credits (federal health insurance premium subsidies) by going through the Affordable Care Act. Likewise, if your employer’s ACA compliant health plan gives you the option to also insure additional family members, your spouse and children will not be eligible for health insurance premium subsidies, as they are deemed to have access to affordable coverage through your employment.
Health Care Reform Myth #4: If I live alone then I am a household of one, regardless of whether I claim dependents on taxes. FALSE!
Health Insurance Fact #4: For the purposes of Affordable Care Act enrollment, dependents you claim on your tax return are counted in your household size, regardless of whether they live with you.
The federal government uses tax records to define household sizes for Affordable Care Act insurance. Even if a dependent does not live in your household, if you claim them on your tax return, they count towards your household size during the tax year they are claimed. For example, if you and an ex-spouse live apart and alternate the years in which you claim a dependent child, you are considered a household of two during the tax years you claim the child, even if the child is not primarily living with you.
Health Care Reform Myth #5: If someone lives with me, I can automatically include them in my household size. FALSE!
Health Insurance Fact #5: under Health Care Reform, you can only include individuals reported on your tax return as a spouse or dependent in your household size.
The federal government uses tax records to define household sizes for Affordable Care Act insurance. Even if someone lives with you, if you do not report them as a spouse or a dependent, they are not counted towards your household size. Roommates, children you do not claim as dependents, or elderly family members who are not claimed as dependents on your tax return do not count towards your household size. For example, if you make $40,000 and your elderly father lives with you – but you do not claim your father on your tax return as a dependent – then you are considered a household of one with an income of $40,000.
Health Care Reform Myth #6: My spouse and I should go through Affordable Care Act enrollment separately, to qualify for bigger individual subsidies. FALSE!
Health Insurance Fact #6: Married couples must enroll in Affordable Care Act insurance together and file taxes JOINTLY to qualify for subsidies.
The premium tax credits awarded under Health Care Reform (i.e. health insurance premium subsidies) are based on household size and total household income. During Affordable Care Act enrollment, the information you enter must match what is filed in your tax return. The Affordable Care Act (ACA) requires that married couples file their taxes JOINTLY in order to qualify for health insurance premium subsidies. This means that spouses must also apply for Affordable Care Act insurance coverage together, and enter their combined total income during the enrollment process. If you and your spouse earn $40,000 each, and you are not claiming any income earning children on your tax return, your combined household income is $80,000.
Health Care Reform Myth #7: When applying for subsidies, The Affordable Care Act only cares about my and my spouse’s income. FALSE!
Health Insurance Fact #7: You must include the income of any dependents claimed on your tax return in your total household income.
During Affordable Care Act enrollment, you must report the income of all individuals you claim on your tax return. Since married couples must file taxes jointly if they wish to qualify for health insurance premium subsidies, this includes the income of your spouse. This also includes the incomes of any working dependents that you claim on your tax return.
For example, if you and your spouse make a combined annual income of $80,000 and you claim a child on your tax return that is working and made $10,000, your total reported household income is $90,000 and your household size is three. If you claim an additional child who has no income, then your household income is $90,000 and your household size is four.
Health Care Reform Myth #8: Affordable Care Act enrollment is only possible during annual open enrollment. FALSE!
Health Insurance Fact #8: Special Enrollment Periods can be triggered by a Qualifying Life Event that enables Affordable Care Act enrollment outside of the annual open enrollment period.
Annual open enrollment is a limited time-period established by the Affordable Care Act (ACA) during which you can purchase or change health insurance. Under Health Care Reform, the majority of the general public is restricted to enrolling or making changes to their health insurance only once a year, during a time span specified by the federal government. Annual open enrollment for 2017 Affordable Care Act Plans will begin on November 1, 2016 and will close on January 31, 2017.
If you miss the annual open enrollment period: Most people who miss an annual open enrollment period will need to wait to purchase or change their long-term health insurance coverage until the next annual open enrollment period begins. In order to begin new coverage, or to make changes to an existing health insurance policy outside of annual open enrollment, you will need to experience a Qualifying Life Event (QLE). Only a QLE may trigger a Special Enrollment Period, which will allow you to make health insurance changes outside of annual open enrollment.
Qualifying Life Events that trigger Special Enrollment Periods: The following is a simplified list of QLE’s that may trigger a Special Enrollment Period: marriage, divorce that results in loss of coverage, having a baby, a change in income, moving into a new coverage area, adopting a child, becoming a foster parent, leaving prison, gaining citizenship, or losing job-based coverage. When one of these events occurs, you have just sixty days to apply for Affordable Care Act enrollment or make changes to your health insurance. In the event of the birth of a child, your start date for coverage may be back-dated to the day the child is born.
Health Care Reform Myth #9: You will have to pay extra if you want help with Affordable Care Act. FALSE!
Health Insurance Fact #9: There is no cost for receiving enrollment assistance from a trained professional advisor.
Fully licensed insurance agents, like the personal reform advisors at WNC Health Insurance/The Asheville Blue Cross and Blue Shield of North Carolina® Store, are available to help you enroll in Affordable Care Act insurance at no additional cost. Our agents have gone through the federal application process hundreds of times and have experience helping people just like you to select an Affordable Care Act insurance plan and apply for federal subsidies.
Not only do the agents at WNC Health Insurance/The Asheville Blue Cross and Blue Shield of North Carolina® Store understand the ins-and-outs of the Healthcare.gov website (where NC residents go to enroll in Affordable Care Act insurance), but they are also familiar with the details of all Blue Cross and Blue Shield of North Carolina® Affordable Care Act Plans offered in NC.
It will not cost you any additional money to utilize the services of our highly trained, licensed professionals. Once enrolled, our licensed agents will continue to offer support and answer any questions that may arrive after selecting your insurance plan. If you live in North Carolina, be sure to visit the WNC Health Insurance/The Asheville Blue Cross and Blue Shield of North Carolina® Store to speak with an agent about how we can help you and your family.
Health Care Reform Myth #10: I can simply pay the same affordable penalty each year for not having health insurance. FALSE!
Health Insurance Fact #10: The individual shared responsibility payment for 2017 is more than DOUBLE that of 2016.
Beginning in the year 2014, the federal government required that all U.S. citizens, and those legally residing in the U.S., maintain health insurance coverage that meets the requirements set forth by the Affordable Care Act (ACA). Exceptions apply only to those who:
- Have experienced a qualifying hardship,
- Are already on government assisted healthcare plans,
- Don’t have affordable plans available in their area (that cost less than 8% of their annual income),
- Have incomes below the federal filing limit,
- Earn less than 100% of the federal poverty level in a state that did not expand Medicaid
- Are members of a federally recognized tribe or religious sect with oppositions to health insurance,
- Are incarcerated.
If you meet any of the above bulleted requirements, you may request an exemption from meeting the mandatory health insurance requirement. Otherwise, you may be required to pay a penalty if you remain uninsured.
If you have an existing health insurance plan: Be sure to check whether it meets the minimum essential health benefit coverage requirements under the Affordable Care Act. If it does not, you may have to pay a penalty when filing your 2016 tax return in 2017.
If you believe you experienced a qualifying hardship: Visit the Healthcare.gov website to confirm that your hardship qualifies and apply for an exemption. The licensed agents at the WNC Health Insurance/The Asheville Blue Cross and Blue Shield of North Carolina® Store are available to answer questions about qualifying hardships and to help you apply for an exemption.
For questions regarding any of the above Health Care Reform facts, help with the Affordable Care Act, or for more information on available Affordable Care Act Plans in North Carolina, contact WNC Health Insurance today!