Update: The Obama administration has announced a special open enrollment period for people who did not realize they would need to pay a tax this year. So you have one more shot to get insurance for 2015, from March 15 to April 30. Here are our tips from February.
Time is running out. The open enrollment period for buying individual health insurance for 2015 ends February 15. Miss this important deadline, and you could remain uninsured all year—and face a steep tax penalty.
As of early February, about 9.9 million Americans had purchased or re-enrolled in private health insurance through the federal and state insurance exchanges created by Obamacare. But an estimated 29 million Americans remained uninsured as of the end 2014, according to the Commonwealth Fund.
Anne Filipic, president of Enroll America, a non-profit that educates Americans about health insurance, says too many people still don't know that they can get financial assistance if they are struggling to pay for coverage.
"There has been a lot of confusion and misinformation," Filipic says. "For a lot of people, they’ve heard of the ACA or Obamacare, but they don’t know what it means for them."
Here's what next week's deadline means and what you need to know about getting covered in time.
1. February 15 is a hard deadline.
The window to buy individual health insurance for 2015 runs from November 15, 2014 to February 15, 2015. After that, you won't be able to buy a policy this year unless you have extenuating circumstances. You may have to remain uninsured until 2016 (open enrollment for 2016 coverage doesn't begin until next October).
There are exceptions. If you marry, divorce, have a baby, move to another state, lose your employer health insurance, or experience another "qualifying life event," you can sign up for health insurance any time. You have 60 days after the event to enroll in a new health plan.
2. You have choices where to shop.
Under the Affordable Care Act, aka Obamacare, you can buy private insurance through government-run shopping websites, also called exchanges or the marketplace. Some states run their own sites; others use the federal government's site. You can find the option for your state at Healthcare.gov, where you'll also be able to see if you qualify for financial help with your premiums.
You don't have to shop on a government-run exchange. You can also get insurance from web brokers, such as getinsured.com, gohealth.com, or ehealthinsurance.com. But if you qualify for a premium subsidy, make sure you get a plan that is sold on the government marketplace.
3. If you can't afford insurance, you may qualify for help.
Almost half of uninsured Americans say they didn't sign up for Obamacare because they thought they couldn't afford it, according to a Kaiser Family Foundation poll. Generally, that shouldn't be the case. The government will pay for part of your health insurance if you earn between 100% and 400% of the poverty level.
The poverty level varies based on your family size. A single person earning between $11,670 and $46,680 this year is eligible for a tax credit. So is a family of four earning between $23,850 and $95,400. With a tax credit, your health insurance will cost between 2.01% and 9.56% of your total income.
The Department of Health and Human Services found that 87% of the people who bought a health plan on the exchanges got financial help, and those people paid an average of just $82 a month. "This is a little known fact for many people," Filipic says.
And if you earn less than the poverty line? The plan was for households making less than 138% of the poverty line to enroll in Medicaid, a state-administered health care program for low-income Americans. Here's the catch: The Supreme Court ruled that the federal government could not force states to expand their Medicaid programs.
As a result, some people in the 21 states that did not expand Medicaid may earn too much to qualify for Medicaid but earn too little to qualify for an Obamacare tax credit. The Kaiser Family Foundation estimates that 18% of uninsured Americans fall in this so-called "coverage gap." Fortunately, about 30% of uninsured Americans are eligible for tax credits to buy private insurance. Another 18% are eligible for Medicaid.
4. If you're not covered, the penalty is going up.
Another reason not to miss this deadline: Under Obamacare, most Americans are required to have a qualified health insurance plan, or pay a fine.
If you went without health insurance for more than three months in 2014, you could owe the IRS up to $95 per person in your household (capped at $285 for large families), or 1% of your income, whichever is higher. And if you go without health insurance this year, the penalty increases to $325 per person (capped at $975) or 2% of your income. The penalty increases again in 2016.
However, you can qualify for an exemption, including for financial hardship. "Most people who are uninsured will qualify for an exemption because there’s a lot of exemptions," says Karen Pollitz, senior fellow at the Kaiser Family Foundation. You can apply for most exemptions right on the tax return; you can apply for other hardship exemptions using this form.
5. You can ask an expert to help you enroll.
Still confused? Get help. All across the country, there are thousands of experts, sometimes called "navigators," who can assist you in-person, for free.
Getting help is especially valuable if you aren't sure if you are eligible for financial help, Pollitz says. Oftentimes, assisters work year-round for free clinics or other public agencies, so if you're in the Medicaid "coverage gap," an assister might be able to connect you with other resources, such as nutrition assistance or free community health services. Plus an ACA navigator or another adviser could help you tally up your income and see if you can claim a tax credit.
You can find an assister near you on the government's site, localhelp.healthcare.gov. Or sign up for an appointment online using Enroll America's connector tool at getcoveredamerica.org/connector. There are about 65,000 appointments available before February 15 at some 4,000 locations, and Enroll America offers contact information for another 11,000 locations. "There’s help out there waiting for you," Filipic says.
6. Even if you bought health insurance last year, you should shop again.
If you bought health insurance on the exchanges last year and then did nothing, you've been auto-enrolled in that plan or a similar plan from the same insurer. But you can still switch plans until February 15.
Take a minute to see if that's still the best deal, especially if you chose the least expensive plan in the first go-round. Last year's cheapest plans have gotten 9.5% more expensive, on average, according to an analysis by the New York Times. You may be able to lower your monthly premiums by switching.
And your benefits can change too, including your deductible and out-of-pocket maximums.
Another reason to re-enroll is to see if you qualify for a bigger tax credit. "Your tax credit from last year was also automatically renewed, but it may or may not be the right amount," Pollitz says. "Even if your income didn’t change at all, you probably qualify for a little more tax credit just because you got older. It's based on a benchmark plan for someone your age."
And while you're at it, think about how you liked your health coverage in 2014. "Are you satisfied with the network? Were you able to get in to seeing the doctors you wanted to see? Were there a lot of hassles getting your claims paid?" Pollitz says. "Now is a good time to see what your options are."
This article was updated to clarify that you can claim most tax penalty exemptions on your tax return, and premium subsidies are only available for plans sold on the government marketplace.