Is There a Penalty for Not Having Health Insurance?
The “H” word Americans don’t feel particularly keen on saying or discussing about is – drumrolls please – health insurance (yes, technically there are two words). If, by any means, the topic of health insurance comes up, be prepared because most probably, a heated debate will start.
And if you have ever thought that not owning health insurance might help ease this conflict, think again.
People complain a lot even when they don’t have health insurance because this leads to penalties. Yes, you read it right, in the year 2019, in the United States of America, people risk facing penalties for not owning health insurance.
The Situation Might Not Be as Bad as You Think
Why might the situation not be as bad as you think? Glad to reply. In the past years, for every month that went by without owning health insurance, a fine would be issued. However, the situation is finally seeing an end with the new governmental law.
This states that starting in 2019, there will be no more federal penalties for health insurance. In the past, the number of penalties would go higher with every year that went by.
The New Tax Law
The Congress had passed the bill, which stated that the health insurance penalty would be eliminated, in 2017. The new law came into effect in 2019 and since then, it had managed to leave a lot of people confused, and without knowing how to feel about this change.
But how exactly does this new tax law work? Starting in 2019, there is no need to purchase ACA-compliant health insurance or a health care plan anymore. Failure to do such a purchase will not result in a penalty.
For many, this might sound as being given the green light at going uninsured. Still, other health insurance policies, which will no longer break the bank, are now available and in accordance with ACA requirements.
But don’t go jumping out of joy yet – the new tax law is only effective for 2019, which means that any penalties issued by December 2018 at the latest still need to be paid.
Exactly, the new law will not erase any penalties that have been made previously. Which means that if you still have penalties left from the previous years, unfortunately, you would have to pay them.
State-Level Health Insurance Penalties
Another thing you should keep in mind is that, although federal penalties have been abolished, this is not the case with state-level health insurance penalties. There are still a few states that have their own requirements when it comes to health insurance and the associated penalties.
Thus, it is advised to check their policies before proceeding any further. These states are New Jersey, Vermont, Massachusetts and the District of Columbia.
To sum everything up, health insurance policies and penalties have, are and will forever be a difficult and strenuous topic to talk about. At least now you know the penalty for not having health insurance.