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One aspect of the Affordable Car Act that has stirred considerable controversy is the mandate for everyone to be insured. That mandate goes into effect Jan. 1, 2014.
One bright spot is that many of those whose employers do not offer health insurance will be eligible for some sort of assistance.
New Mexico is one of the states taking advantage of the ACA’s expanded Medicaid coverage. That means that Medicaid coverage is no longer restricted to pregnant women, children and disabled adults but is available to anyone under 65 whose income is within 133 percent of the federal poverty level.
According to Terry Linton, one of the presenters for the Los Alamos Chamber of Commerce small business insurance workshops, 200,000 of New Mexico’s 400,000 uninsured are expected to qualify for the expanded Medicaid coverage.
More information on Medicaid coverage is available at hsd.state.nm.us/CentennialCare,
Those who do not qualify for Medicaid but earn up to 400 percent above the federal poverty level may qualify for subsidies through the insurance exchange (healthcare.gov.), provided their employers do not offer an affordable, qualified insurance plan.
Income levels for those qualifying for subsidies must fall between:
• $11,490 to $45,960 for individuals
• $15,510 to $62,040 for a family of 2
• $19,530 to $78,120 for a family of 3
• $23,550 to $94,200 for a family of 4
Income levels increase for families with more children.
Those whose incomes are up to 250 percent of the federal poverty level may also qualify for help with co-pays and deductibles.
If an employer provides insurance that offers minimum essential benefits at a cost of no more than 9.5 percent of the employee’s adjusted gross income, the employee cannot qualify for subsidies, even though their income level would otherwise qualify on the exchanges. This provision may be especially hard on families, since the employee cannot qualify for subsidies for the rest of the family, either.
Those whose employers provide insurance can opt to purchase insurance on the exchanges, but will not have the benefit of the employer’s contribution (which must be a minimum of 50 percent of premiums), the exchange subsidies or of having premiums withdrawn from their check as pre-taxable income (although they may be eligible for tax credits at the end of the year).
Those with employer health insurance must also sign up within the company’s enrollment period, which usually ends in November, or wait another year. Those signing up through the exchanges will have until March 15 to sign up (with an April 1 start date). Dec. 15 is the deadline for coverage beginning on Jan. 1.
If someone loses insurance during the year through a circumstance such as becoming unemployed, he or she can sign up through the exchanges at that time.
Penalties for not signing up for insurance may not seem high to someone who does not qualify for the subsidies, but it can be steep for those with limited incomes.
Many mistakenly believe that penalties for the first year are only $95. The penalty is actually based on whichever is higher: $95 or one percent of adjusted gross income
. The penalty for an individual with an income of $30,000 will be $300 the first year. The penalty for uninsured children is $47.50 per child.
Penalties for the second year are either $325 or two percent of adjusted gross income and the third year it will be $695 or 2.5 percent.
Some may qualify for an exemption. Exemptions include:
• Those uninsured for less than three months of the year.
• The lowest-priced coverage available is more than 8 percent of household income.
• Those who do not have to file a tax return because their income is too low.
• Members of a federally recognized tribe or those eligible for services through an Indian Health Services provider.
• Members of a recognized health care sharing ministry.
• Members of a recognized religious sect with religious objections to insurance, including Social Security and Medicare.
• Those who are incarcerated and not awaiting the disposition of charges against them.
• Those not lawfully present in the U.S.
There is also a list of hardship exemptions, which includes homelessness, eviction, victims of domestic violence and those who have filed for bankruptcy in the last six months. For a complete list of hardship exemptions go to healthcare.gov.
Eligibility for either Medicaid or subsidies will be determined during the application process. Until the government works out the bugs in the online signup (healthcare.gov), another option to apply is by calling 1-800-318-2596.
For assistance with the signup process, go to BeWellNM.com.