This story is part of the
Ask Emily
project.

Articles

More time to avoid the Obamacare tax penalty

In my last column, I warned you that March 31 was your last chance to sign up for a health plan from Covered California or the private market if...

Ask Emily on KQED's Forum: Covered California Deadline Approaches

This segment originally appeared on KQED's Forum. Monday, March 31, is the open enrollment deadline for Covered California, the state's...

Last chance: The Obamacare deadline is here

Here it comes, folks, the deadline that I have been harping on for months: March 31 marks the end of Obamacare’s inaugural open-enrollment...

Videos

Audio

How new exchange may help Californians buy health care

Q: I keep hearing about something called the health insurance exchange. What is it and how is it supposed to work?

A: Think of it as a new mall for health insurance, with discounts available for some shoppers.

The “mall,” which is a major piece of Obamacare, is called Covered California. When it opens its literal and virtual doors later this year, it will offer a variety of health plans that cover at least a minimum set of benefits.

It also will accept all eligible paying customers, regardless of medical history or previous diagnoses.

The exchange debuts on Oct. 1 for a six-month open-enrollment period, with actual coverage to begin in January and beyond. Californians will be able to shop for plans online, by phone, by mail and in person at a range of locations, from retailers to tax prep offices.

Now, about those all-important discounts: Individuals and families who earn between 138 percent and 400 percent of the federal poverty level may be eligible for tax credits to offset the cost of premiums. The less you make, the larger your subsidy.

This year, 400 percent equals $45,960 for an individual or $94,200 for a family of four. (Click here for federal poverty level guidelines.)

An estimated 2.6 million Californians will qualify for subsidies. Millions more won’t, but can buy unsubsidized plans from Covered California or on the open market. (If they can afford them, that is.)

Premiums will depend on a variety of factors, including where you live, what level of coverage you choose, how old you are and whether you qualify for the tax credits. For a rough estimate of how much you might pay, try Covered California’s premium calculator.

Here’s an example: A married couple, ages 32 and 35, make $65,000 per year and have a 4-year-old daughter. They would pay $515 out-of-pocket each month for a midlevel plan, after receiving a subsidy of $347 per month.

Their share would drop to $276 per month if their annual income were $45,000 because they would receive a larger subsidy.

For more information, go to Covered California’s website or visit www.coveredca.com.

Q: I’m 28 years old and physically fit. Do I have to buy health insurance?

A: You don’t have to buy health insurance. But if you choose not to, starting next year you’ll owe a tax penalty.

One of the signature elements of President Obama’s health care law is known in wonky terms as “the individual mandate.” More plainly, it is the requirement that most Americans purchase health insurance. (I say “most” because there are some exceptions.)

The tax for those who don’t comply starts at $95 per adult in 2014 (or 1 percent of annual household income, whichever is greater) and grows to $695 by 2016 and beyond (or 2.5 percent of income). The penalty will be assessed on your federal tax return.

But because of your age, you will have a less expensive insurance option: Catastrophic coverage.

Covered California will offer a catastrophic plan for young adults under 30 and for individuals who cannot find affordable health coverage. (Click here to learn more about what’s considered “affordable.”)

This plan will have the lowest premium, but all costs (except for preventive care and the first three office visits each year) are out-of-pocket until the $6,400 annual deductible is reached.

Questions for Emily:  AskEmily@usc.edu
Learn more about Emily here.

Other Articles

Prescription for Success: Caring

When pharmacist Steve Chen first saw him, Mike Metcalfe was straight out of a hospital ward following an eight-day diabetic coma.  He was 50,...

Increased responsibility pays health dividends

Dr. Sarah Ma goes over medications and dosages with diabetes patient Joe Navarro. Photo Credit: Anacleto Rapping This article originally...

More time to avoid the Obamacare tax penalty

In my last column, I warned you that March 31 was your last chance to sign up for a health plan from Covered California or the private market if you...
  • 1 of 81

Authors

Emily Bazar

Senior writer Emily Bazar is based in our Sacramento office, where she covers stories about the federal health care overhaul, Medi-Cal budget cuts, children's dental care and variation in the use of medical treatments.  Prior to joining the Center for Health Reporting, Bazar was a national reporter for USA Today, where she covered immigration, the effects of the current economic recession and other topics. Her first journalism job was at The Sacramento Bee. Over nine years, her beats included transportation, higher education, California politics, the energy crisis and immigration. In 2003, she was one of two reporters who produced an award-winning special project, “Liberty in the Balance,” which explored civil liberties after Sept. 11, 2001. She appears regularly on KQED’s Forum,Capital Public Radio’s Insight and other radio shows to discuss health policy. Bazar graduated from Stanford University.

© 2014 California Healthcare Foundation Center for Health Reporting

LOGIN