*Consider this: A 28 year old musician working as an independent contractor has right lower abdominal pain. He has been in good health, so he put off getting health insurance. He goes to the ER and is diagnosed with appendicitis. The bill from his Emergency Room evaluation is already a few thousand dollars when he is told he needs surgery (appendectomy), and to stay two nights in the hospital.
According to cbsnews.com, twenty-year old Nick Gonzales received a bill for $55,029.31 for his appendectomy at a hospital in Sacramento, California, in October, 2012. What happens to our musician after March 31, 2014? He will be responsible for all of his medical expenses, AND he will have to pay a penalty, based on his income, for not signing up for Obamacare.
What is the penalty called?
That cost goes by a few names such as the “Individual Mandate,” the “Individual Responsibility Payment,” “penalty,” or “fine.”
How much is the penalty?
According to www.Healthcare.gov., the official website for the Universal Healthcare put in place by the Affordable Healthcare Act, the fee for not obtaining health coverage by March 31st, 2014 could be $95 per uncovered person, $47.50 per uncovered child under 18, or 1% of one’s taxable income for 2014, whichever is greater. The fee is capped at the level of the national average premium for the bronze (cheapest) health plan. You make the payment when you file your 2014 tax return in 2015.
Who does not have to pay the penalty?
People are exempt from the penalty if they have an income below the tax filing threshold, which is $10,150 for an individual. One also does not have to pay the penalty if he or she has unpaid medical debt, or if the national premium for the bronze plan (the cheapest plan), is more than 8% of his or her income. These are just some of the exemptions. See additional exemptions on the website.
If I pay the penalty, do I have coverage for my medical expenses?
No. If you pay the penalty, you still are not covered. Whether you pay the fee or not, if you have no pre-existing insurance like Medicaid, Medicare, or your own individual/ group plan, and do not apply for universal health coverage, you are not covered. This means you are financially responsible for 100% of your medical costs.
What is “Minimum Essential” Coverage?
To be considered covered, one needs to have what the marketplace calls “Minimum Essential Coverage.” This includes a Marketplace plan, Medicare, Medicaid, the Children’s Health Insurance Plan (CHIPS), Veterans’ health care plans, and others mentioned on the website. If you have only workman’s compensation, dental or vision coverage, coverage for a specific medical condition or a plan offering discounts for medical expenses, you do not have Minimum Essential Coverage. This means you are not covered, and still have to pay the penalty of not having coverage.
Will I have another chance to enroll?
If you fail to meet the March 31st, 2014 deadline, the next opportunity to enroll will start November 15, 2014 and end February 15,2015. Until November 15, 2014, you will be responsible for any medical expenses you create, unless you have a form of the minimum essential coverage in place.
Lastly, know that penalty will go up significantly in 2015 and 2016.
For more information, and to read the actual Affordable Care Act, go to https://www.healthcare.gov/rights-protections-and-the-law/.
Dr. Kadisha Rapp is a board certified Emergency Medicine physician with over 10 years experience who has practiced in the urban and suburban areas of Washington, D.C., Pittsburgh, Pa., Philadelphia, Pa., and Houston, TX and other cities. You can reach her at [email protected]. Her website is www.drkbrapp.com.
For MORE from Dr. Kadisha B. Rapp, visit: www.drkbrapp.com