Exemptions from health insurance coverage in 2014

How you apply—and even if you need to apply—depends on which exemption fits your situation.

Not everyone will have to pay the penalty fee for not having health insurance coverage if they qualify for an exemption.  The Affordable Care Act states that every person in the United States must have minimum health coverage in 2014 or must pay a fee on their federal tax return.  This fee is sometimes called the “individual shared responsibility payment”. 

Exemptions include:

  • You are uninsured for less than 3 months of the year.
  • The lowest-priced coverage available to you would cost more than 8 percent of your household income.
  • You do not have to file a tax return because your income is too low.
  • You are a member of a federally-recognized American Indian tribe or eligible for services through an Indian Health Services provider.
  • You are a member of a recognized health care sharing ministry.
  • You are a member of a recognized religious sect with religious objections to insurance, including Social Security and Medicare.
  • You are incarcerated, and not awaiting the disposition of charges against you.
  • You’re not lawfully present in the U.S.

If your circumstances affected your ability to purchase health coverage, you may qualify for a “hardship” exemption.  Hardships include any one of the following:

  • You were homeless.
  • You were evicted in the past 6 months or were facing eviction or foreclosure.
  • You received a shut-off notice from a utility company.
  • You recently experienced domestic violence.
  • You recently experienced the death of a close family member.
  • You experienced a fire, flood, or other natural or human-caused disaster that caused substantial damage to your property.
  • You filed for bankruptcy in the last 6 months.
  • You had medical expenses you could not pay in the last 24 months.
  • You experienced unexpected increases in necessary expenses due to caring for an ill, disabled or aging family member.
  • You expect to claim a child as a tax dependent who has been denied coverage in Medicaid and the Children’s Health Insurance Program (CHIP), and another person is required by court order to give medical support to the child. In this case, you do not have to pay the penalty for the child.
  • As a result of an eligibility appeals decision, you are eligible for enrollment in a qualified health plan through the Marketplace, or lower costs on your monthly premiums, or cost-sharing reductions, for a time period when you were not enrolled in a qualified health plan through the Marketplace.
  • You were found not to be eligible for Medicaid because your state did not expand its Medicaid program.  Michigan’s Medicaid Expansion is called the Healthy Michigan Plan, and will roll out April 1, 2014.
  • Your individual insurance plan was cancelled and you believe other Marketplace plans are unaffordable.
  • You experienced another hardship in obtaining health insurance.

How you apply—and even if you need to apply—depends on which exemption fits your situation. Go here for more details and the forms.

Individuals seeking an exemption should complete the exemption application and submit it by mail to CMS (Center for Medicare and Medicaid Services) for processing at:

Health Insurance Marketplace - Exemption Processing
465 Industrial Blvd.
London, KY 40750-0001.

After receiving the exemption application, the Marketplace will send an individual an eligibility determination notice. If the person is determined eligible for a hardship exemption, this notice will include a unique exemption certificate number (ECN) that the consumer will need to include on his or her federal income tax return. If the application was missing information or a required document, the Marketplace will contact the consumer to obtain the information.

After being determined eligible for the hardship exemption, the consumer will be able to view catastrophic plan information and enroll in a catastrophic plan outside of the Marketplace if he or she wants to do so. The consumer is not required to purchase a catastrophic plan.

For more information or assistance, visit HealthCare.gov, or call the Health Insurance Marketplace call center at 1-800‑318-2596. TTY users should call 1-855-889-4325.  You can find local application assisters at localhelp.healthcare.gov or Enroll Michigan or some private insurance companies with plans in the Marketplace.

Michigan State University Extension is providing education about health insurance basics this year, including the why, what and how for making a smart decision. Find out about Smart Choice: Health Insurance workshops and factual information at the Affordable Care Act Roadmap .

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