ACA Individual Insurance Requirement: What You Need to Know

The Affordable Care Act (ACA), also known as Obamacare, introduced the individual insurance requirement, which mandates that most Americans have health insurance coverage. Those who fail to obtain coverage may face a tax penalty.

Who is Required to Have Health Insurance?

The ACA requires individuals to have health insurance that meets certain minimum standards. This includes coverage for essential health benefits, such as doctor visits, preventive care, and hospitalization. Individuals can obtain insurance through employer-sponsored plans, the Health Insurance Marketplace, or private insurers.

When Does the Individual Insurance Requirement Apply?

The individual insurance requirement applies to tax years beginning after January 1, 2014. For most people, this means that they must have coverage for the entire year of 2014.

Penalties for Not Having Insurance

Individuals who fail to have health insurance for a full year may be subject to a tax penalty. The penalty is calculated based on the individual’s income and the length of time they were uninsured. The penalty for 2024 is $695 per adult and $347.50 per child, or 2.5% of your household income (whichever is greater).

Exceptions to the Individual Insurance Requirement

There are certain exceptions to the individual insurance requirement. These include:

Individuals who are below a certain income level
Individuals who are eligible for Medicaid or Medicare
Individuals who have a religious objection to health insurance
Individuals who are incarcerated or living overseas

How to Get Health Insurance

There are three main ways to obtain health insurance:

Employer-sponsored plans: If your employer offers health insurance, you can enroll in their plan.
The Health Insurance Marketplace: You can purchase health insurance through the Health Insurance Marketplace, which is a government-run website that offers a variety of plans and subsidies for low-income individuals and families.
Private insurers: You can also purchase health insurance directly from private insurers.

If you have any questions about the individual insurance requirement or need help finding health insurance, you should contact a licensed health insurance agent. They can help you understand your options and choose the plan that is right for you.