As tax season progresses, millions of Texans are about to find out there's a federal tax penalty for being uninsured. Across the country, Americans who didn't sign up for health insurance in 2014 face the possibility of a fee – 1% of their household income or $95, whichever is higher – and the news may come as a shock. According to the Urban Institute's December 2014 Health Reform Monitoring Survey, 19% of uninsured Americans living above the poverty line heard little information about penalties, and 25% did not hear anything. As they file their taxes, those who are still uninsured not only face the 2014 fee, but are in danger of having to pay an even higher fee next year – 2% of household income or $325 per family member – if they don't get covered this year.
To calm the storm of confusion, the Obama administration has decided to offer an extra 2015 Affordable Care Act enrollment period from March 15 to April 30 for qualifying taxpayers who face penalties for lacking coverage. The six-week extension will allow enrollment for the 2-4% of Americans who meet the requirements.
Two days after the cut-off date for 2015 open enrollment, the Obama administration announced a total of 11.4 million ACA enrollments. This includes insurance policies that have not yet been activated due to nonpayment of premiums. While some of those premiums will be paid, in 2014 sign-ups fell from 8 million to 6.7 million due to failure to pay premiums; this year, ACA enrollments are expected to drop to 9.1 million after unpaid premiums are taken into account – a far cry from the 13 million predicted by the Congressional Budget Office. The ACA was created to make health care affordable for all Americans, so why are enrollment rates not meeting expectations?
Most people who live below the federal poverty line are exempt from the requirement to have coverage, and the ACA Health Insurance Marketplace offers a tax credit that can be applied toward monthly premiums, but it can be hard for consumers to determine which health plan fits them best, and find an insurance plan they can afford. However, free assistance is available.
Foundation Communities offers both tax prep and health care enrollment assistance for no charge. Nora Cadena, media coordinator for Foundation Communities, told the Chronicle, "We do things a lot differently here. We advise people of the very lowest premiums and take them through every plan. No one else is going to do that." Along with Cadena, 125 volunteers help explain the ACA, the benefits health plans cover, and what help they can receive.
In order to qualify for the upcoming enrollment period, a person must 1) either not have known that they were required to have health insurance, or didn't realize how the requirement applied to their household, 2) owe the 2014 fee for noncoverage, and 3) not already be enrolled in a Marketplace plan. Other people may be eligible for a special enrollment period, if they have a qualifying life event. These include but are not limited to getting married, having a baby, losing health coverage, gaining citizenship, and leaving incarceration.
Foundation Communities runs five Community Tax Centers in the Austin area. The office at Highland Mall, 6001 Airport, is open daily starting March 13. See www.foundcom.org for hours, locations, and more info.
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