When studying, working, living or relocating to the USA, it is important to be familiar with it’s laws and mandates.
In the United States, one is required to have healthcare coverage or pay a tax penalty through the Affordable Care Act (ACA). Furthermore, the coverage must be compliant with rules called Minimum Essential Coverage (MEC). In late 2017, the United States Senate has repealed the mandate through a tax reform bill.
Obamacare/ACA has made sweeping changes to the U.S. health care system and how individuals receive access and coverage for medical care. Many of the ACA’s health care reforms are primarily focused on reducing the uninsured population and decreasing costs. The law consists of several provisions and mandates that affect US citizens or residents alike.
What is the individual mandate?
A key provision implemented under the ACA which requires most individuals to obtain a compliant health plan or pay a tax penalty, starting in 2014 and required through 2018 due to the 2017 tax reform bill.
But do you still need to be ACA compliant?
Yes, the Individual Mandate will still be in effect until the end of 2018. Therefore, if you do not want to pay, your compliant coverage needs to stay. But despite the laws, repealed or not, it is a good idea to have health insurance. Individuals should be shopping around for new coverage, rather than letting programs automatically re-enroll them.
The penalty for not having coverage that meets the MEC will be $695 per adult of 2.5% of household income in excess tax filing thresholds (whichever is higher) for 2018.
Does the ACA and individual mandate affect expats?
Yes, foreign nationals and expatriates residing or moving to the US, who maintain residency for 11 months or more, must abide by all provisions and mandates of the Affordable Care Act.
How do I avoid tax penalties?
As mentioned above, the individual mandate will penalize those who do not obtain compliant health insurance coverage. To avoid paying penalties, it is recommended that you purchase and maintain health insurance coverage that meets Minimum Essential Coverage (MEC), such as La Vie À L’Étranger – USA or the New American.
Ending the mandate will let people in the individual market get the insurance they need for the price they want without having to worry about minimums and compliance. Either way, the mandate didn’t have such a huge impact. A majority of the population was able to get exempt status the first year, as it was not strongly enforced. Contact ConciergeCare to help you choose the plan that suits your needs.