How to Avoid Penalties Under the Affordable Care Act

 

Peoria based Samaritan is one alternative to health insurance to avoid Obamacare penalties
Peoria based Samaritan is one alternative to health insurance to avoid Obamacare penalties

Buy insurance by Sunday, January 31, 2016 which is the last day to buy health insurance to avoid a $695 per adult and $347.50 per child penalty, or 2.5% of annual household income whichever is higher.  The only way to avoid the penalty is to have insurance that qualifies as Minimum Essential Coverage, qualify for a life event authorized by the U.S. department of Health and Human Services, or become a member of a faith based healthcare cost sharing ministry. (Faith based health care cost sharing satisfies the Federal health care law’s (Affordable Care Act) requirement that individuals purchase insurance or pay a penalty-tax (see 26 United States Code Section 5000A, (d) (2) (B)).).

Exemptions from the Affordable Care Act to Avoid a Penalty

There are certain situations that enable a U.S. citizen to avoid the penalty mandated by the Affordable Care Act.

  1. If you qualify for post January 31 2016 Special Enrollment Period for people who qualify based on certain Life Events.
  2. If you join a faith based healthcare cost sharing ministry that shares medical expenses instead of buying traditional insurance.  Ministry groups that obtained an exception to the Affordable Care Act law enable members some shelter not only from high medical costs but from penalties. Only ministries in continuous operation since at least Dec. 31, 1999 are exempt from the ACA. The carve-out was intended to satisfy what at the time were relatively small religious groups that argued that their non participation was a matter of religious freedom.  Check reviews and coverage details because these groups are not insurance and may have some risks.  Examples of ministries include:
  3. If you are eligible for insurance that qualifies as Minimum Essential Coverage.

Minimum Essential Coverage (MEC)

Any insurance that meets the Affordable Care Act requirement for having health coverage. If you have MEC, you don’t have to pay the fee for being uninsured (See Healthcare.gov, Minimum Essential Coverage). Examples include:

Sources:

Healthare.gov

The Wall Street Journal

Calculating Your Obamacare Penalty

In 2016, a family of four with $75,000 in household income with two adults and two children at home may owe a penalty of over $2,000 if they choose not to secure health insurance.

Penalty Calculator

Source:

Health insurance.org

 

 

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Michael F. Arrigo

Michael Arrigo, an expert witness, and healthcare executive, brings four decades of experience in the software, financial services, and healthcare industries. In 2000, Mr. Arrigo founded No World Borders, a healthcare data, regulations, and economics firm with clients in the pharmaceutical, medical device, hospital, surgical center, physician group, diagnostic imaging, genetic testing, health I.T., and health insurance markets. His expertise spans the federal health programs Medicare and Medicaid and private insurance. He advises Medicare Advantage Organizations that provide health insurance under Part C of the Medicare Act. Mr. Arrigo serves as an expert witness regarding medical coding and billing, fraud damages, and electronic health record software for the U.S. Department of Justice. He has valued well over $1 billion in medical billings in personal injury liens, malpractice, and insurance fraud cases. The U.S. Court of Appeals considered Mr. Arrigo's opinion regarding loss amounts, vacating, and remanding sentencing in a fraud case. Mr. Arrigo provides expertise in the Medicare Secondary Payer Act, Medicare LCDs, anti-trust litigation, medical intellectual property and trade secrets, HIPAA privacy, health care electronic claim data Standards, physician compensation, Anti-Kickback Statute, Stark law, the Affordable Care Act, False Claims Act, and the ARRA HITECH Act. Arrigo advises investors on merger and acquisition (M&A) diligence in the healthcare industry on transactions cumulatively valued at over $1 billion. Mr. Arrigo spent over ten years in Silicon Valley software firms in roles from Product Manager to CEO. He was product manager for a leading-edge database technology joint venture that became commercialized as Microsoft SQL Server, Vice President of Marketing for a software company when it grew from under $2 million in revenue to a $50 million acquisition by a company now merged into Cincom Systems, hired by private equity investors to serve as Vice President of Marketing for a secure email software company until its acquisition and multi $million investor exit by a company now merged into Axway Software S.A. (Euronext: AXW.PA), and CEO of one of the first cloud-based billing software companies, licensing its technology to Citrix Systems (NASDAQ: CTXS). Later, before entering the healthcare industry, he joined Fortune 500 company Fidelity National Financial (NYSE: FNF) as a Vice President, overseeing eCommerce solutions for the mortgage banking industry. While serving as a Vice President at Fortune 500 company First American Financial (NYSE: FAF), he oversaw eCommerce and regulatory compliance technology initiatives for the top ten mortgage banks and led the Sarbanes Oxley Act Section 302 internal controls I.T. audit for the company, supporting Section 404 of the Sarbanes Oxley Act. Mr. Arrigo earned his Bachelor of Science in Business Administration from the University of Southern California. Before that, he studied computer science, statistics, and economics at the University of California, Irvine. His post-graduate studies include biomedical ethics at Harvard Medical School, biomedical informatics at Stanford Medical School, blockchain and crypto-economics at the Massachusetts Institute of Technology, and training as a Certified Professional Medical Auditor (CPMA). Mr. Arrigo is qualified to serve as a director due to his experience in healthcare data, regulations, and economics, his leadership roles in software and financial services public companies, and his healthcare M&A diligence and public company regulatory experience. Mr. Arrigo is quoted in The Wall Street Journal, Fortune Magazine, Kaiser Health News, Consumer Affairs, National Public Radio (NPR), NBC News Houston, USA Today / Milwaukee Journal Sentinel, Medical Economics, Capitol ForumThe Daily Beast, the Lund Report, Inside Higher Ed, New England Psychologist, and other press and media outlets. He authored a peer-reviewed article regarding clinical documentation quality to support accurate medical coding, billing, and good patient care, published by Healthcare Financial Management Association (HFMA) and published in Healthcare I.T. News. Mr. Arrigo serves as a member of the board of directors of a publicly traded company in the healthcare and data analytics industry, where his duties include: member, audit committee; chair, compensation committee; member, special committee.

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