Individuals and the Affordable Care Act
Here are some key facts about health insurance in 2014. This information applies to people who are on their own to buy individual (nongroup) health insurance. This includes people who are self-employed, between jobs, or do not get coverage from an employer for other reasons.
Access to insurance
Can I be turned down for coverage or charged more because of my health?
No. In 2014, everyone will qualify for health insurance, regardless of health.
Am I required to have health insurance?
Starting Jan. 1, 2014, most people must have basic (minimum essential) coverage or pay a penalty. There are some exceptions. Individual plans sold in 2014 will contain these basic benefits.
How do I know if a plan has the required benefits?
All plans through Cover Oregon, the state's health insurance marketplace, meet the requirements. So do most employer plans and union plans, as well as enrollment in a government program such as Medicare, Medicaid, and TRICARE.
Some examples of health plans that do not meet the requirement of minimum essential coverage are plans that cover only vision care or dental care, workers' compensation plans, plans that cover only a specific disease or condition, or plans that offer only discounts on medical services.
Who is not required to have health insurance?
- Individuals and families whose income is low enough that they do not need to file federal income tax returns
- People who would have to pay more than 8 percent of family income for insurance after taking premium tax credits and employer contributions into account
- Individuals who have been uninsured for less than three months
- People who are incarcerated
- Undocumented immigrants
- Members of American Indian tribes
- People who do not obtain coverage because they belong to religious groups that object to insurance coverage, who belong to a health care sharing ministry, or who qualify for a hardship exemption
What happens if I don't have insurance?
Beginning with 2014 federal taxes, many people who can afford health insurance but decide not to buy it will owe penalties when they file their taxes in the spring of 2015. The penalty is set to increase each year as follows:
- In 2014, the annual penalty will be the greater of $95 per adult or 1 percent of taxable income above the filing limit. (The filing limit refers to the fact that federal income taxes are due from people who earn more than a threshold amount; the penalty is calculated on the amount above the threshold). In 2015, it will be the greater of $325 per adult or 2 percent of taxable income above the filing limit.
- In 2016, it will be the greater of $695 per adult or 2.5 percent of taxable income above the filing limit.
- After 2016, the tax penalty increases annually based on a cost-of-living adjustment.
The penalty for a child is half that of an adult. Only the first two children are counted in calculating the penalty. You may be without coverage for up to three months without triggering the penalty. After that, you would pay the penalty for any month that you are not covered.
If you are required to pay a penalty but do not, the IRS will send you a notice. If you do not pay the penalty, the IRS can reduce the amount of a future tax refund.
Coverage and costs in 2014
What will my plan cover?
Plans sold after Jan. 1, 2014, must include essential benefits in 10 categories:
- Ambulatory (outpatient) services
- Emergency services
- Maternity and newborn care
- Mental health and substance abuse disorder services, including behavioral health treatment
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Laboratory services
- Preventive and wellness services and chronic disease management
- Pediatric services, including oral and vision care
How can I tell how much a plan covers?
Plan labels will help you understand the level of coverage you are buying. The levels of coverage are:
- Bronze - The plan covers 60 percent of expected costs for the average individual
- Silver - The plan covers 70 percent of expected costs for the average individual
- Gold - The plan covers 80 percent of expected costs for the average individual
- Platinum - The plan covers 90 percent of expected costs for the average individual
Insurers can sell more than one plan
in each of the categories. Standard plans will have the same essential
health benefits, making it easier to compare different companies based
on price, doctor/hospital networks, customer service, and other factors.
Also, catastrophic plans sold in Cover Oregon cover only essential benefits but do not have to meet the values of other plans, meaning they do not have to cover at least 60 percent of estimated medical costs. They can have higher deductibles. These plans can be sold only to people under 30 and to others exempt from buying insurance because of financial hardship.
Are there limits on out of pocket costs?
All plans sold or renewed in 2014 must limit your annual out-of-pocket costs (such as co-pays) to approximately $6,350 for an individual and $12,700 for families. These limits will be linked to average premium growth in future years. Also:
- Lifetime coverage limits: Insurance companies cannot place a dollar limit on how much they will cover over your lifetime.
- Annual coverage limits: For plans issued or renewed on or after Jan. 1, 2014, federal law prohibits annual dollar limits on coverage of essential benefits.
What about HSAs?
You may still contribute to a health savings account (HSA).
What is Cover Oregon?
Cover Oregon is a health insurance marketplace where individuals and small employers can compare health plans and get financial help.
Key services are "apples-to-apples" comparisons of health plans and costs, one application to enroll in health insurance plans and public programs (such as Medicaid), quality ratings for insurance companies and plans, and financial assistance (for qualifying individuals). Learn more at www.coveroregon.com.
No one is required to buy health insurance through Cover Oregon. However, subsidies are available only for plans sold in the exchange. Cover Oregon's calculator will help determine if you qualify. You can purchase coverage on the exchange's website or through an agent approved to sell exchange plans.
Who can help me shop for insurance?
Insurance agents who sell insurance coverage on behalf of one or more insurance companies can help you compare plans. Agents can sell consumers insurance plans in the market outside the exchange, like they always have. Agents who sell through Cover Oregon will have undergone additional training. Cover Oregon will have more people who can help you understand your options.
Making coverage affordable
Do I qualify for a subsidy?
Many people whose employers do not help pay for health insurance
coverage will be eligible for financial help through Cover Oregon.
The amount of these tax credits and subsidies to help with out-of-pocket costs when you use medical services depends upon your family size and household income. For example, a family of four making up to $94,200 (400 percent of the 2013 federal poverty level) will be eligible for tax credits to help lower monthly premiums.
How do tax credits work?
If you qualify for tax credits, you can use them in advance without waiting to file your taxes. The advance payment goes to your insurance company to reduce the monthly insurance premium. You may also wait to file taxes or use part of the estimated tax credit in advance.
If you want to use a tax credit in advance, you need to be as accurate as possible in estimating how much income you expect to have in the coming year. If the income is underestimated, you may have to repay part of the tax credits.
If you use tax credits before filing your taxes, you must update Cover Oregon during the year if you have changes to income, family (such as having a baby), or employment (such as getting a job where health insurance coverage is offered). Cover Oregon will change the tax credit amount to reflect the new information. If you forget to update Cover Oregon, you might owe money at tax time. Visit Cover Oregon at www.coveroregon.com for more information about tax credits.
Medicaid (Oregon Health Plan)
Who is eligible for Oregon Health Plan in 2014?
In 2014, more low-income Oregonians will qualify for health care coverage through Oregon Health Plan. Beginning in January 2014, people who earn up to 138 percent of the federal poverty level are eligible. That's about $15,800 a year for a single person or $32,500 a year for a family of four.
There will be no more waiting list for Oregon Health Plan.
How do I get Oregon Health Plan?
Cover Oregon (www.coveroregon.com) will take applications starting in October 2013 for coverage that starts in January 2014.
Help is also available by calling 1-855-CoverOR (1-855-268-3767) or at all Oregon Health Authority and Department of Human Services offices.
If I already have coverage, can I buy separate policies for my children?
Yes. You may buy a policy for a child through Cover Oregon. Any health plan offered through the exchange must also be offered as a child-only plan. You may be eligible for tax credits for child-only plans purchased through Cover Oregon.
However, children who are not citizens or legal residents of the United States are not eligible for child-only plans through Cover Oregon. You may be able to buy a child-only policy in the market outside Cover Oregon, either directly from an insurer or through an agent or broker.
Are undocumented immigrants eligible for coverage through Cover Oregon?
No. Undocumented immigrants are not eligible for coverage through Cover Oregon or for tax credits.