The requirement to purchase health insurance for most uninsured Americans was effective on March 31, 2014. If you already have minimum essential coverage provided by your employer, Medicaid, Medicare, private insurance, or your parents then you were not required to purchase health insurance by the March 31 deadline.
Since long before the Affordable Care Act (ACA) was signed into law in March 2010, there have been many myths and misconceptions surrounding whether or not the health care reform law would have an impact on individuals, families and small businesses.
To help you separate fact from fiction, we have addressed some common myths and misconceptions associated with the Affordable Care Act.
Myth: Only low-income people are eligible to receive discounts to help with premiums.
Reality: Not true. People with income up to four times the poverty line, which is about $95,000 for a family of four, can receive a discount to help to pay for premiums in the form of a subsidy or premium tax credit during open enrollment in the Health Insurance Marketplace. Check out our subsidy calculator to see if you’re eligible for a subsidy and how much it could be worth.
Myth: Everyone has to use the Health Insurance Marketplace to purchase health insurance.
Reality: No one is required to use the Health Insurance Marketplace. If your current health insurance meets minimum essential requirements, you can stay on your current health insurance; if you have Medicare, Medicaid, or CHIP, then you are also covered. The Health Insurance Marketplace is where uninsured Americans and those who don’t like their current plan can go to purchase health insurance during open enrollment (Begins again November 15, 2014). You may also receive a discount known as a subsidy or premium tax credit to help pay for health insurance in the Marketplace.
Myth: Health insurance plans on the exchanges are offered and operated by the government.
Reality: The exchanges, which are essentially online shopping portals, are run either by your state or the federal government – but they offer health insurance plans run by private insurance companies.
Myth: There are no exceptions for the uninsured who have not purchased health insurance. Reality: In some cases, you may be exempt from purchasing health insurance and facing a tax penalty. Some of the exemptions include, not making enough money to file taxes, the lowest-priced health insurance available to you would cost more than 8% of your income, or experiencing a financial hardship.
As with all tax laws, TurboTax has you covered. If you have more questions about the Affordable Care Act and if the law impacts you and your taxes, you can visit TurboTax Health to get answers.