Which states will charge you a penalty if you don’t have health insurance?
One of the key components of the original version of the Affordable Care Act (ACA) was the “individual mandate.” In the world of health insurance, that means a requirement to have health coverage. The ACA had an individual mandate, meaning all Americans had to have health insurance or pay a tax penalty.
But Republican lawmakers opposed the individual mandate, ultimately challenging it in court. Ultimately, the Supreme Court ruled that the mandate was in fact constitutional. However, after the election of President Donald Trump, the GOP-led Congress passed the Tax Cuts and Jobs Act, which eliminated the individual mandate. President Trump then signed the bill into law. Under the new law, the individual mandate was no longer in effect as of January 1, 2019.
However, a number of states have their own version of the individual mandate. And this means that in those places, you still must have health insurance or pay a health insurance penalty on your income tax return for the tax year you did not have minimum essential coverage. Grab our step-by-step guide to enrolling in Marketplace coverage (aka Obamacare or Affordable Care Act insurance) to learn more.
Which states have an Individual Mandate?
Presently there are six states with individual mandates:
- California
- D.C.
- Massachusetts
- New Jersey
- Rhode Island
- Vermont (but there’s currently no financial penalty attached to the mandate)
If you live in one of the above states, this means you must have health insurance coverage. If you don’t, you may have to pay a fine to the state.
Why have an Individual Mandate?
These states have an individual mandate for the same reason the ACA originally did. Without an individual mandate, people would only buy insurance if they knew they were going to need it. Most often, this means the elderly and people with pre-existing conditions.
But those who use their health insurance the most are also the most expensive to insure. Before the Affordable Care Act, insurance companies would evaluate all applicants before enrolling them. Based on people’s age and medical history, the insurance companies would then deny them health care coverage, or charge them more for it. But the ACA made that kind of discrimination illegal. And then it took things one step further. An individual mandate is an incentive for everyone to get health insurance, even healthy people. That meant there was now a larger pool of people applying for health insurance. And with more healthy people getting health insurance, health insurance companies could lower premiums for everyone.
In other words, the individual mandate was meant to be one of the of cost-savings and consumer protections we associate with the ACA. It allows more people to be insured at a lesser rate per person. Even though there is no national individual mandate anymore, some states have passed their own mandates to help keep more people insured at lower costs per person. If the mandates help more people get insured, taxpayers in these states will have lower monthly premiums on average.
How to get enrolled
Whether you live in a state with an individual mandate or not, you can get the coverage you need during Open Enrollment. The annual Open Enrollment Period (OEP) is the time when all eligible Americans can shop the Health Insurance Marketplace. There, you can pick an Affordable Care Act-compliant health plan for 2020. Getting an Obamacare health insurance plan means knows you are getting care that meets certain standards. And this is in terms of both level of coverage and consumer protections. Also, when you shop the Marketplace for health insurance, you’ll also see what kinds of subsidies you qualify for to make that coverage more affordable. These subsidies are based on household income, and they can be very significant—people who enroll on HealthSherpa pay an average of $47/month, and 94% of people qualified for subsidies during 2020’s Open Enrollment. You can also see if you qualify for Medicaid or Medicare on HealthSherpa.
Ready to get started? Shopping the Marketplace with HealthSherpa is streamlined and straightforward. Plus our Consumer Advocate Team is on-hand to help each step along the way at (872) 228-2549.
Thank yo for sharing this info.
I am making sure I understand this information. If I live in Wisconsin, Health insurance is not mandated?
Correct, there is no penalty for not having health insurance in Wisconsin. We still recommend shopping and seeing if you can get an affordable plan – if you make below 400% of the federal poverty line, you qualify for subsidies. You can see plans and prices here: https://www.healthsherpa.com/
Hi
This blog was… how do you say it? Relevant!! Finally I’ve found something that helped me. Thanks!
what if you live in Pennsylvania but work at New Jersey do health insurance is mandated?
If you work in NJ but don’t live there, NJ will not mandate that you get health insurance. But we still recommend you get health insurance in Pennsylvania.
Thank You
Your blog is amazing dude. i love to visit it everyday. very nice layout and content ,
that’s strange, i was told i need to have insurance in FL otherwise ill pay a penalty. would love to be able to give it up. i feel it is a waste of my money towards a system that lives from my taxes and gives them to people who spend their time trying not to pay taxes.
Florida does not have an individual mandate, so you are able to go uninsured without paying a penalty. We recommend you get a plan, however, to avoid huge medical bills if something happens to you. Go to healthsherpa.com to see plans and prices and to see if you’re eligible for a subsidy to lower the cost.
I live in new york is there a mandate to have healg
h insurance through my employer
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Employers are mandated to provide health insurance to full-time employees if the company employs more than 50 people. For individuals, there is a mandate to have health insurance, so if your employer doesn’t provide it, you can get it through the NY state health exchange or healthsherpa.com.
This is criminal
So is Arizona mandate health insurance
Arizona does not have a health insurance mandate.
Although California has mandate, it is easy to get an exemption. Most people over 40 who don’t have insurance through an employer will be exempt from the mandate because the insurance is unaffordable. I’m self-employed and make $200k/yr and still get the exemption because the insurance is so unafforadable.
How do you get exempt?
So, Pennsylvania doesn’t have a mandate on insurance?
Correct
Hi, I’m trying to figure out if Oregon has a tax penalty for not having health insurance. Their official website says that they do (https://dfr.oregon.gov/insure/health/pages/who-must-have.aspx) but every other resource I’ve read (like your blog) says that Oregon does not. Do you think Oregon’s website is out of date?
Their website is out of date. Oregon does not have a tax penalty, but we still recommend seeing if you can get an affordable plan. Subsidies have been expanded and now 97% of people on our site qualify for a subsidy. Go to healthsherpa.com to see prices.
in California my monthly payment for basic coverage would be 850.00 per month my penalty about 3500. for no coverage That’s a lot less for me to pay the penalty than buy insurance. I’m pretty sure the penalty money is used so some onter person can get insurance
Is it mandatory in New York State to have health insurance?
no
Does Dallas Penalty You For Not Having Insurance?
Does Dallas Have A Penalty For Not Having Insurance?
Does Dallas Penalty You For Not Having Insurance?
Does Dallas Penalty You For Not Having Insurance?
No
I confused? I thought Health Insurance is mandatory every person must have carry . Or pay a fine when filing income tax.
The mandate was repealed, so it’s only mandatory in some states.
Does the State of KY have a mandate?
I have insurance through SideCar Health(cash and go). They are not a major insurance company so they don’t send out the 1095.
Will I penalized? What would I do to show that I had some coverage?
The 6 states with mandates are listed in the article.
Hello, thank you for all the info.
Can you tell me how I can keep track of which states require the individual mandate, or when states change their status? I deal with employees form all over the place, so trying to keep this straight and have the most updated info would be really helpful.
Thank you,
Debra
States rarely change their status at this point, but you can check this post.