Cover Oregon Health Insurance Exchange Questions & Answers
This is a guest post by Michael Nelson, a licensed tax consultant and an Oregon health insurance producer from Nelson Financial & Estate Planning in Woodburn, Oregon. I first met Michael during the Dave Ramsey Financial Counselor Training that my husband and I attended last year and was impressed with his desire to learn as much as he could to help his clients make sound financial decisions. I asked Michael if he would help us understand the new Affordable Care Act and how to use the Cover Oregon Health Insurance Exchange.
Before we dive in, a quick note: I understand that the ACA is a politically charged issue (well, that may be the understatement of the decade). This post is intended only to help my readers in Oregon understand what their options are and direct them towards a competent insurance professional. In light of this, please refrain from leaving any political rants on this blog. I get that many of you are frustrated, but neither Michael nor I can make a single change to the law. Contact the people representing you in Congress with your feedback.
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Healthcare. Insurance. Requirement. Ugh… All words we don’t like, and yet, they will all become a reality starting in 2014. While there are obviously tons of political opinions about the requirement to have health insurance in 2014, the fact remains that it is going to happen and individuals and businesses need to be aware of how the new laws will affect them.
As a Licensed Tax Consultant (#30376) and Oregon Health Insurance producer, I understand the confusion and frustration. Below I have outlined some key areas of the new healthcare law along with answering some common questions I often receive.
The Affordable Care Act (nicknamed Obamacare) created “exchanges” in order for individuals to shop for health insurance and possibly receive tax credits to help with the cost of the premiums. Each state was given a choice to use the Federal Exchange that is managed by Human and Health Services or to create their own. In the usual pioneer-spirit of the Northwest, both Washington and Oregon created their own exchanges.
Once the exchanges are fully functioning, an individual and small employer may search for health insurance coverage from the different health insurance companies through the exchange. If individuals and small employers meet certain qualifications, they may receive a tax credit for the health insurance that they purchase through the exchange. The tax credits will not be issued for health insurance purchased outside of the exchange.
Below are some common questions asked about the new health insurance requirement in Oregon:
Do I have to get Cover Oregon insurance?
Insurance that is purchased from Cover Oregon is not “Cover Oregon insurance” but insurance that is purchased from insurance companies through the market place called Cover Oregon. For example, an individual will have multiple options for plans with different deductibles and coverage from multiple insurance companies like Lifewise, Kaiser Permanente, Moda (formerly ODS), Providence, and others. Also, health insurance can be purchased outside of Cover Oregon and still meet the requirement to have health insurance for 2014.
What if I didn’t qualify for health insurance before?
There are no longer any pre-existing conditions. Health insurance companies used to ask numerous questions about your health in order to see if you qualified for their plan. The only questions now that will affect your premium amount (besides your age and the number of family members) will be if you regularly use tobacco.
What if I have health insurance through my employer or my spouse’s employer?
If you have health insurance through your employer in 2014, you will meet the requirement to have health insurance and there is no need for you to explore Cover Oregon.
There are rules in the Affordable Care Act that indicate that if an employee is required to pay over 9.5% of their household income on their portion of the health insurance through their company (if it was only that person being insured) then that coverage would be deemed unaffordable and that individual may apply for health insurance with Cover Oregon. It seems unlikely that this will apply to very many individuals as larger employers are also aware of this new rule and will most likely calculate to ensure their employees don’t have to pay more than 9.5% of their wages on their portion of the premium.
What if I have Medicare?
Generally, if you are over the age of 65, you are enrolled in Medicare and will meet the requirement to have health insurance for 2014. Individuals with Medicare can purchase additional Medicare advantage plans to supplement their coverage, but that is not necessary to meet the requirement to have health insurance.
Wouldn’t it be easier to just pay the penalty?
Most insurance seems like a pain until something major happens and then most people are thankful they had insurance (or wished that they would have had insurance). Many individuals are reasoning that they will just pay the penalty until they get sick, but that won’t necessarily work with the new changes to health insurance. An individual (outside of an employer plan) may only enroll in health insurance during an open enrollment period unless there is a life changing event during the year (getting sick is not one of the qualifying events).
For example, health insurance for 2014 can only be purchased from October 1, 2013 – March 31, 2014. After that, the next time someone can enroll for health insurance is for the calendar year of 2015 and that open enrollment period will only be from October 2014 – December 2014.
In addition, the 2014 penalty is the GREATER of $95 a person ($285 maximum) OR 1% of the Adjust Gross Income. So, a family with 2 parents and 2 kids that makes $20,000 a year would pay a $285 penalty for not having insurance, but a family with 2 parents and 2 kids that makes $60,000 a year would pay a $600 penalty ($60K multiplied by 1%). The penalty will increase to 2% of the Adjust Gross Income in 2015 and 2.5% in 2016.
Is there a way to receive assistance in paying for the premiums?
The “subsidies” that individuals are hoping to receive for helping pay their health insurance premiums are actually called premium tax credits. These are tax credits that you will receive on your tax return based on your household size and income.
For example, a family of 4 can receive this tax credit if their income is $94,200 or less. A family of 6 may earn up to $126,360 and still receive tax credits. These tax credits are similar to tax credits like the child tax credit, but now this credit can be received in advance. For instance, instead of receiving a $1,200 credit on your tax return, you can have that $1,200 broken up into 12 equal payments (for each month in the year) and have $100 sent to the insurance company to help pay for your premium.
This process of having the insurance receive your tax credit in advance will be available once an individual can fully apply on Cover Oregon and then you will reconcile the amount you received in advance on your tax return. Also, since the tax credit is based on your Adjusted Gross Income, there are certain tax strategies that can benefit your family and also lower your Adjusted Gross Income to help you qualify or receive a larger premium tax credit (definitely speak with a tax professional on this one).
How does this affect employers?
Employers with 50 or more “full time equivalent” employees are required to offer health insurance to their employees starting in 2015. Employers with 25 or less employees can receive tax credits for paying for health insurance for their employees if the health insurance is purchased through Cover Oregon.
In some circumstances, employees may benefit more from getting an individual policy through Cover Oregon and potentially receive tax credits to help with the premium than to pay 50% of the premium that the employer may offer. There are other ways that an employer can provide help to their employees’ health cost without offering health insurance to them. For instance, an employer may make contributions to an employee’s Health Saving account.
I’m self-employed. How does this affect me?
Self-employed individuals are also required to have health insurance in 2014 and should look at coverage through Cover Oregon for possible tax credits. If an individual receives the tax credits in advance (see above question), it is important to make sure they know what their net profit is throughout the year because an in increase income could cause an individual to have to “pay back” the advance payments they received on their tax return.
Also, employer tax credits are not available for employees that are related so individuals that are self-employed and have family members on payroll should look into getting individual coverage through Cover Oregon.
What if I’m currently enrolled in the Oregon Health Plan or Healthy Kids?
Individuals that are currently enrolled in the Oregon Health Plan (OHP) and Healthy Kids should have received a notification about submitting a “fast-track” form. The notices should have been mailed out at the end of September and individuals need to mail back the “fast-track” form to be enrolled into health insurance coverage for 2014. Individuals that are not currently enrolled in the Oregon Health Plan and Healthy Kids should consider applying through Cover Oregon to see if they could potentially qualify for the OHP or Healthy Kids.
Oregon Health Plan (OHP) provides health coverage to low-income Oregonians. Healthy Kids provides no-cost health coverage for uninsured children and teens up to the age of 19 in Oregon.
How much do I need to make to qualify for the Oregon Health Plan, Healthy Kids, or Tax Credits?
Individuals may qualify for the Oregon Health Plan (OHP), Healthy Kids, or Premium Tax Credit if their household size and income is a below a certain range of the Federal Poverty Level. Each year the Poverty Level is determined based on the number of people living in a house and the income that household generates.
For 2014:
- If the household size and income is below 138% of the Federal Poverty Level, than that family should qualify for the Oregon Health Plan.
- If a family has children (ages 0-18) and their household size and income is below 300% of the Federal Poverty Level, then the children should qualify for Health Kids and the premiums for the children should be zero.
- If a family is under 400% of the Federal Poverty Level, then they could qualify for a tax credit.
Here is an illustration to understand how this will work:
If a family of 4 makes $30,000 for a year, they should qualify for the Oregon Health Plan. If a family of 4 makes $50,000 a year and two of those family members are children (under the age of 18), then that family would qualify to have their children on Healthy Kids and the other two members could qualify for tax credits for the premiums they pay for health insurance. If that family of four made $50,000 a year and everyone was over the age of 18, then that family would qualify for the premium tax credits and not Healthy Kids. If a family of 4 makes $100,000 a year, they would not qualify for any tax credits.
Currently, the information for the Oregon Health Plan and Health Kids are not yet available. The website for Cover Oregon is also waiting to become fully available. Once the Cover Oregon is fully functional, individuals will be able to apply for coverage and find out exactly if they qualify for the OHP, Healthy Kids, or Premium Tax Credits. Individuals should consider talking with an agent to discuss how their income and household size will qualify them for the OHP, Healthy Kids, or tax credits. Again, you can have an agent at no cost to you.
When do I need to get coverage if I am choosing to use the Cover Oregon exchange?
The open enrollment period for Cover Oregon has already begun and will last until March 31, 2014. In order to have coverage on January 1, 2014, you will need to submit an application to Cover Oregon by December 15, 2013. The Cover Oregon website is still being updated and should hopefully be able to receive applications by the end of the month.
How can a health insurance agent help you?
A health insurance agent can help you decide which plan would be best for you and your family at no cost to you. They can also help you fill out the Cover Oregon application to ensure you receive the tax credits (when it becomes available online). Health insurance agents can also help answer questions you have about how the new health care laws will affect you. You can find an agent certified to answer your Cover Oregon questions on Cover Oregon’s website.
If I can answer any more of your questions, please contact me neltax.com/healthcare. I have online seminars that further discuss how the health insurance requirement will affect you. Also, I would love to be your agent and help you find the best plan for you and your family. Please submit your name and number on my website and I will contact you soon to start discussing the best health care coverage for you.
Michael and I are planning additional posts discussing Cover Oregon, including case studies that illustrate the realities of the changes with the ACA. Please leave your questions in the comments and we will do our best to answer them in the near future!
Disclaimer: This information is for general guidance only. Please consultant a tax professional to see how the new health care law will personally affect you.
This post may contain affiliate links. See the disclosure policy for more information.
I submitted my application through Cover Oregon before December 4th and still have not heard back about my coverage options. I would really like to get insurance. Do you feel the best options would be through Cover Oregon? My husband’s employer doesn’t provide insurance and I am self employed. Thank you.
My husband is a pastor and so portion of his check is designated as housing allowance. According to the IRS, “A minister’s housing allowance, sometimes called a parsonage allowance or a rental allowance is excludable from gross income for income tax purposes, but not for self-employment tax purposes.” Do we include his housing allowance as income for the Cover Oregon website? How about for Oregon Health Plan? I have researched and have been told both yes and no….
Link to the IRS quote: http://www.irs.gov/Help-&-Resources/Tools-&-FAQs/FAQs-for-Individuals/Frequently-Asked-Tax-Questions-&-Answers/Interest,-Dividends,-Other-Types-of-Income/Ministers'-Compensation-&-Housing-Allowance/Ministers'-Compensation-&-Housing-Allowance
Hey Kara,
You would not include the housing allowance as income for the calculation for Cover Oregon. Please look on your 2012 tax return and locate the line labeled “Adjust Gross Income” (line 37 on the 1040) — that is the amount you want to use in determining if you qualify for any tax credits or Oregon Health Plan.
The paper application for Cover Oregon is a little tricky for ministers as you will need to include your husband’s income and then put the correct adjustment for the self employment tax deduction (the number has recently changed). I have helped several Pastor fill out the Cover Oregon application and can give you free assistance as well if you contact me (clicking on my name will take you to my website). Also, I can help you strategize what to include as housing allowance for 2014 to best match your desires for health insurance and premiums to pay.
I am unmarried, I’ve never been married…..I have a 7 yr old son who currently receives coverage through healthy kids connect soon to be OHP…I work and had insurance through my job but it will stop the beginning of the year..I claim my son on my taxes, his dad lives with us works and gets insurance through work….when I called cover Oregon to ask if I need to include him on my application the lady said no because they define a household as a married couple so we are actually 2 seperate households…I’m nervous because I’m on medications and I also don’t want to get on trouble by filling this out wrong…if I put his income on the application it will raise our total income therefore making my monthly premium way over $200 just for me 1 person….or do I put his income and check the box that says “not applying for insurance” then will it subtract his income making my premium in the $100 range…or do I do what the lady says and don’t put him because we aren’t married therefore we are 2 seperate households?
Hey Summer. The quick answer is that you will only want to put yourself and your son on the Cover Oregon application. When inputting information in for the Cover Oregon application, the term “household” basically means whoever is on your tax return. Although all three of you are in the same household, you guys are actually filing two tax returns. You are filing your tax return with the tax status of “Head of Household” because you are claiming a dependent and your son’s father is probably filing as “Single” on his tax return. Now, if your son happened to make money during the year, then you would want to include that income as well for your household. I know this is very unlikely for a 7 year old unless he is like a TV child star, but is much more feasible for a 17 year old that works a summer job but is still claimed on their parent’s tax return. I hope that helps. I would appreciate if you would add my name (Michael Nelson) and license number (8980488) to your application as I will receive credit for helping you and there will be no cost to you.
So, what’s included in the 9.5% of income?
Fo example, we pay $140 twice a month AND we have to pay out $4600 before our insurance picks up anything, then we’re on the hook for about half until 6K. That’s about 10% but does that count? Do duductibles count?
We’d rather purchase something new through Cover Oregon that gives us better coverage, but can we?
Hey Jessica,
The 9.5% of income is for individuals that are paying for health insurance premiums through their employer. The deductible and out of pocket expenses that you would pay for medical expenses with your health insurance does not have affect on the calculation of the 9.5% of your income.
If you are paying for health insurance through your employer and the premiums that you are paying are over 9.5% of your gross pay, then you would qualify for getting insurance through Cover Oregon. To calculate if the premium you are paying is over 9.5%, you will need to find how much it would cost for the employee to have “self-only” coverage (that is, coverage for just the employee and NOT with spouse and dependents). If the total monthly premium is over 9.5% of what is earned, then that person can apply through Cover Oregon. For example, if my employer required that I pay 50% of the premiums for my health insurance and I had to pay $280 a month to insure just myself (and not my spouse or children), then I would qualify to get insurance through Cover Oregon if my total (gross) income was $2,947 or less a month because $2,947 times 9.5% is $279.97 and paying $280 would be over that amount.
Often I found that an employee’s portion for the health insurance is well below the 9.5% of gross income, but once you add the spouse and children, then the portion for the premium is well over 9.5%. In this case —- ( this is where I usually take a deep breath if I was talking to you ) — you do not qualify for any tax credits because there is employer coverage available.
However, there may be cheaper insurance still available for you by possibly purchasing your own health insurance. An agent, like myself, can help you decide if that is a good decision or not, and I highly recommend using an agent’s service as it is free to you. Also, you will want to make sure you are not leaving any special advantages of having an employer plan for your dependent children.
ok, thanks for taking the time to answer my question. That’s what I figured. Our problem is we don’t have time to see someone. We got our work insurance packet last week and have to sign up by end of day tomorrow or not sign up. Until yesterday, I had no idea there were agents that could help us. I thought we had to fight and wait for the website to be fixed. We were kind of holding our breath that it would be useable. So another year of work insurance I guess.
Jessica,
I can look to see if there is a possible better plan for your family that would cost less than $280 a month if you email me this evening and I’ll get an answer back to you tonight. You can find my email address by clicking my name and finding my email address on my webpage.
I’m trying to understand this better. My husband has insurance through his work. He pays a very small percentage for it each paycheck (maybe 7.5%). In order to add us (our baby and I), it would cost almost his entire paycheck (for the month). I called CoverOregon and they said that since it was an option for us to be added to his insurance, we would not qualify for the tax credit. Am I missing something? Thanks!
Heather,
Sorry for the bad news but you wouldn’t qualify for any tax credits because possible coverage is available. I understand your frustration as there are many in the same situation that you are in. You maybe able to find a different plan for yourself and baby that may be cheaper than being added to your husband’s policy if you apply outside of Cover Oregon. I can help you look for those possible plans if you email. Michael@neltax.com
So from my understanding if you income changes (you start making more money) when you do your taxes you may have to repay subsidies. I know there is a cap on this repayment. My question is does this work in the reverse? My husband was recently laid off from a well paying job and will likely find a job in 2014 that pays equally well. Right now we qualify for subsidies but I am inclined to pass on them. Will we receive a tax credit if at the end of the year our gross income would have qualified?
Hi Kimmy.
First thing, you will only qualify for tax credits if you receive your health insurance by going through an Exchange (Cover Oregon). You could potentially receive a tax credit if your income for the year is below the income level of your household size. The number that is used on your tax return to calculate your income level is the Adjusted Gross Income (line 37 on Form 1040) which includes several subtractions that a taxpayer has control over. For example, an individual can make a contribution to a traditional IRA and lower their Adjusted Gross Income and potentially receive a higher premium tax credit. If you have a Health Saving Account insurance plan, then you can setup a health savings account bank account and make contributions to that account. Those contributions can also lower your adjusted gross income and help you save for health insurance costs.
So, if you are close to reaching the level for receiving tax credits then I would encourage you to apply through Cover Oregon. Currently Cover Oregon is responding to individuals who have sent in an application to see if they qualify for tax credits. Some individuals have decided to just keep their current individual / family policy or apply outside of Cover Oregon to have the peace of mind that they have a policy in place for January 1, 2014.
So if I am reading this correctly if I opt to just purchase my insurance and at the end of the year I would have qualified for credits but didn’t receive them (because I didn’t go through cover Oregon) I can still get the credit on my taxes when I file?
Am I the only one who is incensed by the obamacare regulations?!
Probably not :).
I’m sorry, I should have been more clear. My husband and I are coved thru his work. We wont be applying for ourselves but still need (legally now) coverAge for our grandson. Will I be able to get him coverd?
Does your husband’s employer have coverage for dependents? It sounded like from this post that your grandson is now your legal dependent.
My husband and I are raising our now 13; year old grandson. We don’t have legal custody so he is uninsured. Can I get insurance for him through Healthy Kids without custody? My daughter (his mother) is on OHP but can’t insure him as he doesnt live with her.
Kismet,
If I understand the calculations correctly, you should be able to include him as a part of your household when you apply to Cover Oregon. If your household income is below $58,590 for the three of you (your husband, yourself, and your grandson) then your grandson should be automatically enrolled into Healthy Kids. I’m assuming that you are (or going to) be claiming your grandson on your tax return as a dependent. I believe based on the facts that he is living in your household and that you will probably claim him on your tax return, you should be able to apply with him being apart of your household and qualify for Health Kids. Although, the best thing is to wait until the Cover Oregon website is fully functional and apply online then and it should make the correct determination about your grandson receiving health insurance.
Moca- I may be wrong, but I think that having your employer pay you back for private insurance is technically illegal.
Thanks Ari. We never heard of that… So, the company has to pay the premium directly…? Why is it illegal, if so? I can’t think of the reasons why the company can’t reimburse it after we pay.
I just want to say thank you the article. You have answered a lot of my unanswered questions. I’m sure I’ll have question in the morning but I’m sure they’ll already be asked and answered by then. So I can just read through them. Again,thank you all involved in the article!
Thanks for the great article!
Well, I have one question…
My husband is working for a small company which is in California. The employee in Oregon is only my husband. (We used to live in CA.) The company is paying our insurance right now (total is $433 for two), but can the company or we get tax benefit? Or is Cover Oregon only for companies in Oregon…?
By the way, right now, we pay premium and the company pay us back.
Hey Moca,
Cover Oregon only has Oregon Health Insurance companies. Part of the information you need to apply for Cover Oregon is your zip code and county so it can find the right health insurance companies that are offering health insurance in your area. Since you live in Oregon, you are going to want to get health insurance from an Oregon company if you want different insurance than you currently have. I would encourage you to look into Cover Oregon as you may be eligible for some tax credits. You can check by entering your household size and income to the calculator at Cover Oregon.
Employers really shouldn’t reimburse their employees for individual coverage. Rather, employers should get group coverage for their company if they are wanting to give that sort of benefit to their employees. The idea is that only individuals are suppose to pay for individual / family insurance. Insurance companies are known for not receiving checks from a company to pay for premiums for individual / family policy because of this rule.
You indicated your husband’s employers is a small company, so that company may be eligible for some tax credits if they offer group health insurance to the employees. The requirement to receive the tax credit is that they must have under 25 employees and the average annual wage is under $50,000. They would also need to get health insurance through an Exchange (Cover California in their case).
Employers that are wanting to help their employees with healthcare cost but don’t necessarily want to take on the full cost of paying ever-changing premiums should consider making monthly contributions to an employee’s Health Savings Account (HSA). An employee would need to have purchased an insurance policy that is HSA-eligible and setup a separate bank account to set aside money (tax-free) for medical expenses. Once that is setup, an employer can make contributions to the employees account and receive 100% deduction for that expense and the employee will receive 100% of that contribution to be used to pay for medical expenses.
An employer can also give a bonus to help their employee with the extra cost of medical expenses in 2014, but there a few downsides to that. First, an increase in wages will potentially decrease the possible premium tax credit that individual / family may receive. Secondly, that bonus will be taxed through the payroll taxes and will not be a 100% contribution to the employee. For instance, a $100 contribution to a Health Saving Account will result in $100 the employee can use for medical expenses, but $100 bonus will be more like $93 (or less) of a benefit to the employee because of the payroll taxes.
I have a question. My oldest child is 21 and has moved to and is working in California to gain residency so she can finish her college career through a college in California. She is married but separated and files taxes with her husband. Would I be able add her and her income to apply for Cover Oregon or not add her and have her get coverage through the California exchange?
Amberdani,
You would not be able to add your daughter to your household size and income because she is not apart of your household. Also, since she files taxes with her husband, you wouldn’t be able to claim her as dependent. She should look to get coverage through the California Exchange. Hope that helps!
I truly appreciate the knowledgeable information being presented on this post. As someone who works in the health insurance industry, it is refreshing to see that the importance of a licensed insurance agent is being highlighted, as they are critical to wading through all of the difficult decisions facing consumers. Thank you Angela and Michael!
Great article. Thanks for answering a lot of my questions.
Excellent topic Angela (as usual-your site has been a great wealth of info for me in many areas & is greatly appreciated).
As a pediatric nurse who worked in the hospital for > 20 years, I would say that having medical insurance is tremendously important for any age. I will never forget my patient back in the 80’s-a teenage girl, who developed a very severe case of ulcerative colitis (not at all common in a person that age) & was in the hospital for prolonged periods-even required nutrition through an IV. Very unfortunately- her family was without insurance, as they had changed jobs and were in the 3 month waiting period 🙁
I have a question that is not specifically related to Cover Oregon, but I’ve been meaning to try to find out the answer for a while. I am 24 and will be 25 in January, which (I think) means I can stay on my parents’ employer insurance until I turn 26 in January 2015. My fiance is 25 and will be 26 in August 2014, at which time he will not be able to stay on his parents’ insurance. My employer offers insurance, but his does not. We are getting married in July 2014. What would be the best way for us to go about staying insured as we transition to our own insurance? Should we plan to enroll him in his own plan for August-December 2014, and then enroll both of us in my employer insurance in January 2015? (Can he even start a new plan in August?) I really appreciate your help!
Amanda,
Quick question — when is your employer’s open enrollment period?
December 1st
Amanda,
This is what I would do if I was you. I would maintain your coverage through your parent’s policy for 2014. For your fiance, I would have him start looking for coverage through Cover Oregon after you get married unless your employer allows him to enroll outside of their enrollment period and without you actually have health insurance with your employer’s insurance. You will want to check with your employer about their rules for adding someone to their policy outside of their enrollment period. Then, in December 2014, I would enroll both of you guys into your employers coverage.
Ok, here is the reason for my suggestion —
1) You might as well maintain your coverage with your parent’s insurance as I’m assuming you are not having to pay any premium for that benefit and you are allowed to be on their policy even through you are married.
2) For individuals, the only time you can enroll into a health insurance policy is during the open enrollment period unless their is a “Change in Circumstance” or “Qualifying Event” — you can look up both definitions of these terms at Cover Oregon in their Glossary of Terms (scroll to the bottom of the page, 4th column). Basically, it says that marriage is a qualifying event. I also made two phone calls and was assured that loosing coverage from your parent’s policy would be a qualifying event as well, but I don’t directly see that on their webpage. So, I suggest you use the qualifying event of marriage to start looking for coverage for your then husband. 🙂 I believe you have 60 days to find a policy, so you could probably wait until August anyway when he turns 26. Also, be sure to put me as your agent when signing up for Cover Oregon — it doesn’t cost you anything and it will allow me to further help you pick out the best policy.
3) I would enroll in your employer’s coverage in December 2014 because you can NOT receive premium tax credits for an individual policy if you have an employer that offers health insurance.
Finally, congratulations to you and your fiance. I hope everything comes together smoothly for your wedding and you two have a wonderful marriage together.
Check with your employer to see if there is a 30 day period at least for after your wedding to see if you can get your spouse on your insurance. My work has a 30 day period after your married or birth of child to add someone during the calendar year.
Great advise Stacy! 🙂 Michael
What about non taxable income? The last I applied for my kids for OHP, they wanted to know your non taxable income. Will this be required to be submitted for insurance?
Jessica,
Non-taxable income will need to be included when determining if you qualify for any tax credits or OHP. Currently, the Cover Oregon websites is only asking for household income, but once the online application is made available they should have further questions to verify non-taxable income when filling out the application.
My husband and 2 children currently have insurance. I do not. I went in the Cover Oregon website and put in some annual wage figures to see how it would change the tax credits for a family of 4. According to the site, a family of 4 can receive a tax credit for an income under $94,200. While it showed a tax credit at $43,000, when I put in $51,000 there was no longer any credit. This is a substantial difference.
Also, I’m confused as to what the penalty would be just for me if I don’t sign up. Can anyone clarify?
Hey Lori,
I’m planning on have a future post that will discuss this topic in further detail. If you go back and look at these plugged numbers in the Cover Oregon website, you will see that those income amounts qualify your family for Health Kids (look on the top of the screen — just above the premium amounts). Basically, a family of 4 can earn up to $70,650 a year and have their kids (18 and under) qualify for Health Kids. The information on healthy kids is not yet available but it should be a zero premium to cover your children.
Lori,
I also see how the calculations change when you plug different numbers into the Cover Oregon website. I’m not positive that the calculator is working correctly. I believe part of the reason the numbers change for the tax credit is because the children are taken out of the equation for the tax credit once they are found to be eligible for Healthy Kids. For example, if you try to get coverage for 3 individuals that are over the age of 18 and have a household income of $51,000, then the Cover Oregon websites says you qualify for tax credits, but if two of them are children, then the kids would qualify for Healthy Kids and that individual wouldn’t receive the tax credit.
I believe the tax penalty is based on the number of individuals that are not insured in 2014. The only examples I have been able to find is for a family that is paying the penalty per person, rather than the percentage amount, but it seems to indicate that the penalty will be based on each person that does not have health insurance.
I have the exact same situation as Lori. I too wonder if the calculator is working correctly.
Also, I received a notice that they are discontinuing Healthy Kids at the end of the year (which was the subsidized program). I wish they would get the information up on the new program. I am guessing it will be more like the OHP than Healthy Kids which is too bad.
The Cover Oregon website is still using the term “Healthy Kids” — I believe the new program will follow more of the rules set by the Affordable Care Act (ACA) and will probably go by the ACA name of C.H.I.P. (Children’s Health Insurance Program). I’m guessing it will be similar to the current Healthy Kid’s program.
Kathy,
Everyone that applies through Cover Oregon will need to include their household income. So, in this case, you would include your husband’s social security (disability) income. On your tax return, you probably only include a portion of the social security income as income (creating your Adjusted Gross Income) but for the purposes of the premium tax credit, you need to include the entire social security earnings.
I believe the Cover Oregon website will figure this number once the webpage is fully running and you can apply, but until then I would include your income and your husband’s income to estimate what kind of tax credits you may receive.
Amy,
Individuals will need to have health insurance starting January 1st, 2014 in order to avoid a tax penalty on their 2014 tax return. The penalty will be calculated for every month that a person does not have health insurance — with the maximum being either the great of $95 a person for the year, or 1% of the adjusted gross income for the year (please review the above question about the tax penalty to see which penalty you would qualify for). In other words, if someone was insured for only 6 months of the year, instead of paying a $95 penalty they would pay a penalty close to $47.50.
If an individual wants to have health insurance coverage through Cover Oregon by January 1st, 2014, they need to have their insurance application submitted by December 15th of this year. A paper application can submitted now, but I was advised by someone at Cover Oregon that a paper application may take up to 45 days to process. I would recommend individuals figure out what policy they want now, and then apply online once the system is fully functional — which may be in a few weeks.
The tax code seems to indicate that everyone must have health insurance in 2014 (and following years) or pay a penalty unless they are exempt. A Christian Sharing ministries is one of those exemptions. The two biggest sharing ministries that I know of is Medishare and Samaritan Sharing Ministries. These groups are exempt from the rules of the Affordable Care Act and so (to answer your question) there is no minimum coverage needed if you choice to get your health insurance with these organizations.
There is another exemption to having health insurance and that is “Short Coverage Gap” which allows an individual to not have health insurance for 3 consecutive months in the year. I believe this isn’t for the convenience of an individual but rather for that person to look for proper health insurance if they loose coverage. I could see this happening if someone retires from a job that has health insurance but they need to find coverage until they are covered by Medicare. It seems logical that an individual could wait until March 2014 to get coverage and then claim a “Short Coverage Gap” to avoid the full penalty, but I would definitely advise to try and secure insurance before December 15th.
I have a online seminar about other ways someone can be exempt on my website (http://www.neltax.com/healthcare/exempt.html). My gut reaction, though, is that unless you get coverage through a Sharing Ministry, you will probably not be exempt.
or does anyone here know the answer. HELP!!!!
I have a question. My husband is 65 and is on SS disability. He is on medicare. I have an individual plan, which will no longer be available as Jan 1. The plan they would like to switch is not very good insurance and will cost $250 more a month. I cannot afford it. I will be applying to coveroregon. I have received confusing information as to whether his SS figures into the amount I will be paying for insurance or not. If not, I will be in the Oregon Health plan. Can he cover this question. I have not seen anything on line to help me.
That’s a great question, Kathy! I’ll make sure Michael sees it and addresses disability income in a future post!
I work for the exchange in California. The rule is that if you are taxed on it (based on your adjusted gross income) then you have to include it as income. It’s all based on MAGI which if you google you can see more info. on. Line 37 on the 1040 tax form. These are the federal guidelines.
Kathy, I responded to your question below. Sorry that I didn’t just “reply” to your message.
What is the deadline for acquiring health coverage without facing a pentalty? The March 31st “deadline” is misleading, if that is not the deadline for the penalty.
Also, do the Christian Sharing options still qualify under Obamacare? (such as Medishare & Christian Sharing Ministries) If so, is there a minimum coverage we would need? (Their lowest plans don’t pay out until we’ve paid 10K, etc so it’s only for major medical)
We are with a Christian Share ministry, and ours is exempt from obamacare.
I too was looking into that. I saw this group advertised in WORLD magazine http://samaritanministries.org/ and it seems they are able used with the new healthcare law.
I responded to your question below. Sorry I didn’t click “Reply” so it would be in the same question. Michael
I have a question. My husband is on SS disability. He is on medicare. I haDoes his income