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What Happens if I Don’t Have Health Insurance in 2014?

What Happens if I Don’t Have Health Insurance in 2014?

Posted Feb 28, 2014 by Jenifer Dorsey

The 2014 enrollment deadline is getting closer, and I am not sure I want to buy health insurance. I do not have access to an employer plan, and I don’t qualify for Medicaid, a hardship exemption or much of an Obamacare tax credit to help pay for premiums. What happens if I decide to skip out on health insurance this year?

The Affordable Care Act requires that most Americans have health insurance. Those who do not qualify for a hardship exemption and fail to buy health insurance coverage may be subject to a tax penalty known as the shared responsibility payment. If you decide not to buy health insurance, you will likely owe this payment to the IRS when filing your 2014 federal income tax return in 2015.

Here’s how the penalty works this year and in the years ahead:

As of Jan. 1, 2014, if you do not qualify for a hardship exemption, you are allowed to go without health insurance coverage for one period of less than three months. This year some special allowances have been made due to glitches with HealthCare.gov early in open enrollment. The Obama administration will give Americans until March 31, 2014, to buy health insurance that qualifies as minimum essential coverage.

Those who have not purchased health insurance on or away from the health insurance exchanges by March 31, 2014,[1] as well as those who exceed the allowed coverage gap in subsequent years, must pay the shared responsibility payment.

The 2014 penalty is as follows: $95 per adult and $47.50 per child with the maximum penalty being $285 or 1 percent of your total household income with the maximum penalty being the national annual average premium for a bronze plan, whichever is greater. The amount is adjusted based on how many months you go without health insurance coverage. The shared responsibility payment will increase annually.

After March 31, 2014, you will not be able to change your mind and buy minimum essential coverage this year. The only exception is a qualifying life event that makes you eligible for a special enrollment period. Such events include a change in marital status, the addition of a child to your family, a permanent move to an area that offers different health insurance coverage options or involuntary loss of coverage in certain circumstances, to name a few.[2]

Your options should you go without health insurance

If you do not purchase health insurance that fulfills Obamacare’s individual mandate, you may be putting your health and finances at risk. Accidents and unexpected illnesses can happen at any time, and the resulting medical bills can cause financial hardship. Unpaid medical bills are the No. 1 cause of bankruptcies in the United States.[3]

You may consider some level of health insurance benefits such as temporary health insurance or a hospital indemnity plan. These options do not qualify as minimum essential coverage, which means they do not fulfill the requirement that you have health insurance. They are also ineligible for any premium tax credits or other Obamacare subsidies. They do, however, provide some financial protection should you require hospitalization or a trip to the emergency room, among other medical services.  To read more about these and other health insurance options, as well as the Affordable Care Act, browse the articles at healthedeals.com.

Call 888-839-7679 to speak with a certified health insurance advisor who can answer your Affordable Care Act questions, help you explore your options on or away from the Obamacare Health Insurance Marketplace, and also provide information about other types of health insurance coverage.

[1] Please note: If you buy health insurance by March 15, 2014, the earliest effective date is April 1, 2014. If you buy from March 16 through March 31, 2014, the next available effective date will be May 1, 2014.

[2]HealthCare.gov. (n.d.). How Can I Get Covered Outside of Open Enrollment? Retrieved from https://www.healthcare.gov/how-can-i-get-coverage-outside-of-open-enrollment/.

[3] LaMontagne, Christina. (2013, June 19). NerdWallet Health Finds Medical Bankruptcy Accounts for Majority of Personal Bankruptcies. NerdWallet Health. Retrieved from http://www.nerdwallet.com/blog/health/2013/06/19/nerdwallet-health-study-estimates-56-million-americans-65-struggle-medical-bills-2013/.

Jenifer Dorsey is a freelance writer whose specialties include health and fitness, wellness, sports and recreation. She is a competitive amateur track cyclist who also enjoys mountain biking, hiking, camping and other outdoor adventure. Jenifer received a B.A. in journalism from Columbia College Chicago and is an MFA candidate at Naropa University. She lives in Colorado.