A Light at the End of the Tunnel

October 1st arrived with great fanfare as the new “Marketplaces” (nee Exchanges) launched. At last, a light at the end of the health insurance tunnel.

Have you tried to log on to your state’s “Affordable Care Act” website?If you were successful, take a giant step to the front of the class to receive your gold star. But for the rest of us, that light at the end of the tunnel is attached to a big locomotive and it is quickly bearing down on us. If you are not covered by “Minimum Essential” health insurance coverage on January 1, 2014, you may be subject to a fine (or as Justice Roberts decreed, a “tax”).

If you are a younger person, not insured now, not planning to enroll, but intending to just pay the tax because it is less than $100.00 during 2014 tax year, think again. The initial tax penalty is equal to the higher of 1% of your prior year’s income or $95.00 per adult plus $45.00 for each child, up to $285.00 per family.

Starting in 2015 the penalty tax goes up to $325.00 per adult plus $162.50 per child up to the higher of $975.00 or 2% of your 2014 family income. After that the tax increases again to the higher of 2.5% of prior year’s family income or $695.00 per adult and $347.50 per child, up to $2,085.00 per family.

The penalty kicks in on Janaury 1, 2014. So, if you change your mind and then enroll in March 2014, you may be accessed a penalty tax for the portion of 2014 while you were uninsured. Also, keep in mind that 2014 enrollment period for Obamacare ends March 31, 2014.

Projected monthly premiums for the Affordable Care Act’s Bronze, Silver,Gold,and Platinum plans are considerably outside most people’s comfort zones. Your decision is whether to take food off the table to pay health insurance premiums, or skip the insurance and take food off the table to pay the penalty tax. “Change you can believe in” can get to be pretty darn expensive.

Carpe Deim