Repercussions and Reprieves at Health Insurance Enrollment Deadline

WASHINGTON - America's health insurance marketplace closes on Monday night, the deadline for most people to obtain coverage or face a penalty.

The confusion and uncertainty of the last six months appear likely to continue as consumers, including some who have never had insurance, begin using new policies for the first time. Here are answers to some frequently asked questions.

Q. What happens if a consumer does not sign up for insurance by the Monday deadline?

A. The consumer may be subject to financial penalties, to be paid with federal income taxes next year. However, the federal government has said it will stretch the sign-up deadline for people who started an application and could not finish it for one reason or another.

To preserve their rights, consumers can call the federal insurance marketplace (1-800-318-2596) and request a 'special enrollment period.'

Officials running the federal marketplace, which serves 36 states, will provide an unspecified amount of extra time to people who are 'in line as of March 31,' and some states running their own exchanges have adopted similar policies.

In addition, the White House says, consumers may be able to obtain more time if they attest that they have had difficulty signing up - if, for example, they encountered error messages or 'other system errors.' Officials will not generally investigate such claims, but they note that the application for health coverage is submitted under penalty of perjury.

Q. What is the penalty for going without insurance?

A. The penalty is either a fixed dollar amount or a percentage of household income, whichever is greater.

The flat dollar amount this year is $95 per adult and $47.50 per child, up to a maximum of $285 for a family.

Many people will be subject to a higher penalty: 1 percent of household income above the 'filing threshold.' The threshold this year is $10,150 for individuals and $20,300 for married couples filing joint returns. People with gross income below these thresholds are generally not required to file tax returns, and they can obtain exemptions from the penalties.

For a single person with income of $40,000 this year, the penalty would be $298.50. The first step in calculating the penalty is to subtract the filing threshold ($10,150) from household income ($40,000). The result is $29,850. One percent of that is $298.50.

For a married couple with two children and household income of $70,000, the penalty would be $497. That is 1 percent of household income above the threshold.

The penalty will increase in future years. In 2016, it will be $695 per adult or 2.5 percent of household income over the threshold, whichever is greater.

It is unclear how aggressive the government will be in enforcing the requirement to have insurance and in collecting the penalty. If a consumer fails to pay the penalty at tax time, the Internal Revenue Service can deduct it from any refund owed to the taxpayer, but it cannot impose a lien on property or garnish wages. Under the health care law, the consumer 'shall not be subject to any criminal prosecution' for the failure.

A. The health care law authorizes many kinds of exemptions, and the Obama administration has added a few.

Under the law, no penalties can be imposed on people who would have to pay more than 8 percent of their household income for the lowest-priced insurance available to them.

The requirement for people to have coverage does not apply to members of certain religious sects who are 'conscientiously opposed to acceptance' of health insurance benefits. Nor does it apply to members of organizations known as health care sharing ministries, which provide a faith-based alternative to traditional insurance.

Prisoners and illegal immigrants are also exempt, and no penalties can be imposed on members of federally recognized Indian tribes.

Kathleen Sebelius, the secretary of health and human services, has authorized 'hardship exemptions' for people in more than a dozen categories. These include people who are homeless or facing eviction or foreclosure; victims of domestic violence; and victims of fires, floods and other disasters.

In addition, people are entitled to exemptions if they were found ineligible for Medicaid solely because they live in a state that decided not to expand the program. Congress tried to require states to expand Medicaid, but the Supreme Court ruled in 2012 that states could opt out, and about half have done so.

Exemptions are also available to people who face the cancellation of individual health insurance policies and consider the alternatives unaffordable.

Finally, the administration has created an open-ended category of exemption for people who experience other, unspecified hardships in obtaining insurance.

Some exemptions can be obtained only from an insurance exchange, and others only from the I.R.S.

Q. What should people do if they applied for insurance but never received an insurance card?

A. They should call the insurance company or the toll-free number for the federal insurance marketplace. The government has caseworkers to help consumers, but it could take weeks or months to solve some problems.

Q. What changes or delays might be expected in the coming year?

A. The experience of the last four years strongly suggests that there will be more surprises. Federal officials will almost surely make changes to rules and policy as they discover problems and respond to political pressure and pleas from consumers in this election year. The government and insurers could be dealing with a substantial backlog of work because of the last-minute surge in applications.

Officials have said they may allow special enrollment periods for other reasons. With all the exceptions and adjustments, an insurance executive said, 'open enrollment could go on for the rest of the year.'

As midterm election campaigns heat up, the administration may look for ways to address or deflect Republican criticism of the law. It could, for example, relax or delay requirements for medium-size employers to offer insurance to employees. Officials will also look for ways to prevent big premium increases next year. The law already allows the government to provide a financial backstop to insurers that sign up disproportionate numbers of sick people.

The administration will also try to protect employees whose hours might be cut by employers eager to avoid the cost of providing health benefits. Officials have already indicated that they want to address complaints about high deductibles and 'narrow networks' of doctors and hospitals in some health plans.