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Oct 24: Obamacare penalties may be delayed

obamacare penalties

Summary by Emr industry

  • The Obama administration will delay enforcement of the Affordable Care Act’s health insurance mandate, extending how long Americans may go uninsured before facing a penalty under the law, MarketWatch has learned.
  • The health care law requires most people to have health insurance by Jan. 1, 2014 or face a penalty, but the Administration may postpone when those penalties will go into effect. The law allows for “short coverage gaps” of up to three months before imposing the penalty
  • The Administration, however, has recognized that there’s a “disconnect” between the actual and effective deadlines, as the deadline to get health insurance in time to comply with the ACA is currently six weeks earlier than the final deadline to buy it.
  • Those problems, perhaps the elephant in the room during deadline discussions, may influence a decision to provide an enrollment grace period to avoid fines.

Original News

The health care law requires most people to have health insurance by Jan. 1, 2014 or face a penalty, but the Administration may postpone when those penalties will go into effect. The law allows for “short coverage gaps” of up to three months before imposing the penalty, which is $95 or 1% of an individual’s income (whichever is greater) next year. Under the current rules, someone would have to be covered by March 31, an official with the Department of Health and Human Services confirmed, which is the final day that people will be able to purchase health insurance on the public exchanges, or marketplaces, created by the ACA..

But the Administration is currently working to revise its policy to ensure that people who wait till the last day in March to sign up will not face a penalty, the HHS official clarified. That means that people may go uninsured till April or May without paying a fine, as it takes up to two weeks to process health insurance applications, and new health policies take effect on the first day of each month. A last-minute March 31 application, for example, might be processed by mid-April for coverage starting May 1.

The Administration, however, has recognized that there’s a “disconnect” between the actual and effective deadlines, as the deadline to get health insurance in time to comply with the ACA is currently six weeks earlier than the final deadline to buy it. Now, the Administration is working to make sure the two deadlines line up with each other, says the HHS official. An announcement about when it will enforce the penalty for being uninsured, and whether that penalty will be delayed beyond the de facto March 31 deadline, will come shortly. The insurance requirement still kicks in Jan. 1, and the enrollment period will close March 31 as planned, the official adds.

The potential extension comes as the federal health exchanges are under fire for ongoing technological problems that are making it difficult for some people to enroll. The Obama administration has so far resisted GOP pleas to delay the requirement that individuals purchase insurance next year, but has lately expressed frustration with the technical difficulties. Those problems, perhaps the elephant in the room during deadline discussions, may influence a decision to provide an enrollment grace period to avoid fines.

There is another sign that the penalty policy may be in flux: While HHS referred MarketWatch’s previous inquiries about the fine, and the deadline to avoid it, to the Treasury, a spokesperson there referred a request Wednesday back to HHS, suggesting that the health officials are now the ones writing new rules for the law.

source

 

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