The Affordable Care Act, commonly called “Obamacare,” requires individuals to buy health insurance or pay a penalty beginning in 2014, with open enrollment starting in October 2013.
The IRS has issued finalized rules for the individual mandate portion of the Affordable Care Act, President Obama’s healthcare plan. Under the new rules, individuals choosing not to carry insurance are subject to a penalty of $95 per person each year, or 1% of household income, whichever is greater. Over time, the penalty increases, so that by 2016 the penalty is $695 per person, or 2.5% of household income. Subsequent years will be calculated based on a cost-of-living formula. The IRS also specified what constitutes the minimum level of coverage under the new law. Several exceptions exist to the individual mandate, including those people who lack insurance while temporarily unemployed, or those individuals whose health care is supplied by a temporary staffing agency. Those who qualify for Medicaid, but live in a state that has opted out of the new expanded program, such as Texas, Pennsylvania, or Wisconsin, will also be exempt from the penalty.
Stay tuned this is the first in a series of blogs regarding Obamacare…..