The Individual Mandate
Increasing the number of Americans who have health insurance is a primary objective of the Affordable Care Act. That’s why the reform law has coverage requirements for individuals.
Most U.S. citizens and legal residents have to be enrolled in a health insurance plan that meets minimum essential coverage. People currently insured through an employer or a plan they bought on their own likely meet the requirement already. So do those enrolled in a Medicare plan, TRICARE, Medicaid, and a few other programs.
People who are exempt from the requirement are those who:
- would have to pay more than eight percent of their income for health insurance,
- have incomes below the threshold required for filing taxes, or
- qualify for religious exemptions.
Also exempt are:
- undocumented immigrants,
- people who are incarcerated, and
- members of Native American tribes.
People who are required to have health insurance but choose not to buy it will be required to pay a penalty when filing their taxes.
| Year | Percentage of family income | Set dollar amount |
|---|---|---|
| 2014 | 1% | $95 per adult and $47.50 per child (up to $285 for a family) |
| 2015 | 2% | $325 per adult and $162.50 per child (up to $975 for a family) |
| 2016 and beyond | 2.5% | $695 per adult and $347.50 per child (up to $2,085 for a family) |
The total penalty for the taxable year will not exceed the national average of the annual premium for a bronze-level plan offered through the health insurance marketplaces.