Penalty for No Health Insurance
A lot of the medical practices we service are asking us questions about the Affordable Care Act (Obamacare) and how it may affect their patients.
One of the questions we hear asked is if there is a fee, penalty, or tax for not having health insurance,
as some of the young adults don’t want health insurance and just pay cash if they do need to see a doctor.
According to the government:
Starting January 1, 2014, if someone doesn’t have a health plan that qualifies as minimum essential coverage, he or she may have to pay a fee that increases every year: from 1% of yearly household income (or $95 per adult, whichever is higher) in 2014, to 2% of income (or $325 per adult), to 2.5% of income (or $695 per adult) in 2016. The fee for children is half the adult amount. The fee is paid on the federal income tax form.
So yes, call it what you want – a fee, a penalty, or a tax – but if you do not purchase health insurance coverage, you will have to pay a fine.
Here are the penalties by year. As you can see, a family choosing not to have health insurance in 2016 will have to pay a fine of $2,085.
| FEE FOR NOT HAVING HEALTH INSURANCE | |||
| 2014 | 2015 | 2016 | |
| Adult | $ 95.00 | $ 325.00 | $ 695.00 |
| Child | $ 47.50 | $ 162.50 | $ 347.50 |
| Max Family Penalty |
$ 285.00 | $ 975.00 | $ 2,085.00 |
Here is a link to HealthCare.gov where you can check out the fee you pay if you don’t have health coverage and if you can get an exemption from the fine or tax.
What are your thoughts? Can you pay more than 2 grand for not having health insurance next year? Leave me a comment below.
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This is extortion ! Our ins used to be 250.00 now it is over 600.00 this is per month. Has Trump fixed this yet?
Hi Kay,
the well outstanding informative post you have shared on this page about the health insurance portability and acountability but It took several years for doctors, hospitals, health plans and clearinghouses to start effective everyday using of the new health care standards under The Health Insurance Portability and Accountability Act. Data transmission and processing went strictly under the demands of the active legislation and quickly spread in the health care and insurance sector.
Thanks.
Corruption ! I don’t think why it is necessary to pay for health insurance. It should be your own decision, not a necessity.
I agree!! I am single Mom of 2 dependents and I only make about 40k+ p/yr. (that’s about 3400 a month of net income) I have to pay $1400 in rent (that’s the low income rate!! here in California) for the remaining month I am suppose to pay for food, gas, childcare, and other needed things. By the end of the month I have about $40-100 remaining. I have no Health Insurance for myself but my kids receive the government sponsored ins.
If I purchase insurance through the government sponsored options I am told I have to pay $349 p/mo. THIS IS NOT affordable. Through my employer is is $320.00 just for myself (if I chose to add the kids it goes up to nearly $800)! I don’t understand how they are expecting people to afford healthcare??
Hi Tina ,
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Thanks.
CORRUPT!!!!! We just had our open enrollment, health insurance is a never ending Ponzi scheme! The government colluded with the insurance companies to rip Americans off period!
I have health insurance for 2016 through my employer but my family has moved out of the country until the end of the year, so which one do i need to pay as penalty if i don’t take insurance. Would it be 2% of my income or would it be person for my wife and 2 kids? Thanks.
Hello,
How is the fee pro-rated? I got health insurance from my employer starting 11/1/15, so that only makes 10 months without coverage for 2015.
Thank you.
Jan I believe you would end up paying 10/12 of the fee since you didn’t have insurance for 10 out of 12 months in 2015. Your tax accountant will be able to tell you specifically how this all works to make you pay the appropriate penalty. Make use you talk to them for advice.
The insurance that I have gotten through healthcare.gov was cancelled because the insurance company claims that I failed to pay the first month premium. I did pay on time, but did not know the transaction to withdraw the fund from bank account did not occur. However, thinking everything was fine I paid my next premium when it came due. This payment went through. A couple of weeks later I get a cancellation letter. I apparently do not qualify for an exemption and I cannot afford to get insurance on my own.
So, my question is, I think my fee will be about $350, is this a fee that I will have to pay for each month that I don’t have insurance? Or, is that the total fee?
Steve as far as I know, and things do keep changing, the fee is paid once a year when you file your federal 1040 income taxes. The fee is actually a tax.
If my husband has coverage but me and my 2 children do not what will that look like for us? We are filing jointly but he is insured through his job.
Tiffanie, I am sorry to say that I believe you and your children will have to pay a penalty for not having health coverage. Your tax professional should be able to tell you exactly the amount of tax you will have to pay for not having health insurance.
Here is some info directly from HealthCare.gov:
“The fee for not having coverage in 2014
If you didn’t have coverage in 2014, you’ll pay the higher of these two amounts:
1% of your yearly household income. (Only the amount of income above the tax filing threshold, about $10,000 for an individual, is used to calculate the penalty.) The maximum penalty is the national average premium for a bronze plan.
$95 per person for the year ($47.50 per child under 18). The maximum penalty per family using this method is $285.”
Don’t reproduce, how’s that?
Another example of criminals within out government straight up robbing the poor and giving to their rich buddies.. Why not tax the business that are filtering their money all over the world so they don’t have to pay taxes.. or pay a livable wage.. or produce goods that are toxic and dangerous just so they can pay slave wages.. The American people are under direct attack from these criminal.. All of our Politicans and bought and paid for, our courts are just as crooked and back scratching.. America is in a grave state.
I cannot believe my tax assessor charged me $400.00 and my spouse $400.00 this year for not having health insurance . Its crrrrrrraaaazzzy!
I agree Lorena, it is nuts. You are basically paying for someone else to have health insurance.
I’m sorry but if you don’t use it you shouldn’t get taxed for it. It should not have been made in to a law. It is just a new way for greed. One should not have to pay for something they don’t want. If they don’t use it why pay for it. It’s not cheap.
I can not believe there is a fee, if you are not health insured. I changed my plan, and do not feel that the new plan is that affordable at all. So how a person with low income is supposed to pay any insurance is very questionable. To put a fee on people who still can not pay an insurance seems more then ridiculous…
Silvia L.
If the fee is paid on the Tax forms, you still haven’t answered the question: Is it a yearly fee or a monthly fee that is accrued throughout the year? For B. Brandt, this is not the place for partisan politics.
This is a yearly fee that you will pay on your tax returns.
For me, still much less than paying the monthly premium ($395) and carry a major medical policy.
The premiums that are more affordable still come with a $5,000 deductible, so bottom line still not receiving medical care even with health insurance, since the prices for services before deductible are met are too high, and an individual would have to see a doctor every week for six months or longer in order to reach deductible. This means that these policies are affordable for those who don’t need them, like Mr. Obama, these premiums are much higher than BEFORE this “affordable act”. Seems to me this is just Obama’s way of bringing the USA out of debt by having the IRS collect fees . This is not helping ensure that US citizens receive quality care or any care. What a façade!
Is this fee paid monthly or yearly?
Kay, the fee (tax) is paid on your tax returns as I understand it.