Obamacare Q&A: Deadline scramble, repaying subsidies and what the new plans cover

Next Monday is the final day to enroll in individual-market health insurance for 2014. After that, if you haven’t had coverage this year and haven’t signed up, you could face a penalty under the federal health law commonly known as Obamacare.

This Obamacare Q&A includes questions about what to do about that deadline if your coverage is slated to run out later this year, what the government can and can’t do to you if you don’t get insurance, what the new plans cover, and the possibility that some people might have to repay some or all of the federal funds used to discount their premiums.

If you have a question about Obamacare, email Mirror Health Reporter Arielle Levin Becker at alevinbecker@ctmirror.org.

QMy family and I are covered by HUSKY (Connecticut’s Medicaid program), but we won’t be eligible after May.  After that I may need Obamacare coverage, but everything I’ve read says I need to sign up for it before March 31.  So should I sign up now? I don’t want to lose the free prescriptions and doctor visits that HUSKY covers if I don’t have to yet, but can I sign up for Obamacare after March 31?

AMarch 31 is the last date for people who want individual-market insurance in 2014 to sign up for coverage. But there’s an exception: If you find yourself in need of insurance later in the year because of a change in circumstances, such as losing a job, getting divorced or losing eligibility for Medicaid, you’ll be able to request a “special enrollment period” and sign up at that time.

So in your case, there’s no reason to drop your HUSKY coverage now. Instead, you can maintain your current coverage until it ends and request a special enrollment period to get insurance to replace it after May. You’ll have 60 days from the date of the change in circumstances (in your case, the end of your HUSKY eligibility) to sign up for new coverage.

To learn more about requesting a special enrollment period, click here.

QI’m out of work, signed up for insurance through the exchange and got a government subsidy for my monthly premium payments. If I get a job and switch to my new employer’s health care policy, will I have to pay the subsidy back to the government? And if so, how and when?

AYou might have to repay a portion of the subsidy, but whether you do and how much it would be depends on your total income for 2014.

If you end up owing money, you’d pay it to the government when you file your taxes next year.

Here’s how this works:

The subsidies people get to discount their premiums are actually tax credits, paid in advance to your insurance company when your monthly premiums are due. (You can also elect to have some or all of the tax credit paid to you as a lump sum tax refund next year, but that means you’ll get less up-front assistance paying your insurance premiums each month.)

The amount of the tax credit you get in advance is based on an estimate of what your total income will be this year. The actual amount you’re entitled to won’t be known until the end of the year, when it’s clear how much you actually earned. And if there’s a difference, that will be reconciled through your taxes.

If your income was lower than estimated when you applied for coverage, you could be entitled to a larger tax credit and get some money back. If your income was higher than estimated when your subsidy was calculated, you could owe money to the government for some or all of the cost of the tax credit you received.

If that’s the case, the amount you have to repay will be based on your income. For people who earn below 400 percent of the poverty level – that is, people whose income qualifies them for a subsidy – the amount of repayment will be capped. (At most, a family earning just below 400 percent of the poverty level could have to repay $2,500.)

But if at the end of the year, it turns out that your income was too high to have received any subsidy, you’ll have to pay back the full amount.

Connecticut’s exchange, Access Health CT, asks people whose incomes change to report it within 30 days. That way, the exchange can adjust their subsidies to match their new income levels and reduce the need to repay any of the tax credit later.

Here’s a look at what the maximum repayment limits are:

QI’m 28 and don’t have a job or income. I don’t really want health insurance. What do I do about Obamacare? I don’t want to be locked up for not having insurance. How do I avoid it?

AThe government can’t put you in prison for not having health insurance. The penalty for not having insurance is a fine: 1 percent of your income or $95, whichever is higher (the amount will rise next year).

If you don’t have any income at all, you’re exempt from the mandate for having coverage. People whose income is too low to require them to file a tax return (usually below about $10,000 for a single person) don’t have to pay a penalty for not having coverage.

But if you live in Connecticut or one of the 25 other states that expanded their Medicaid programs as part of Obamacare, chances are you qualify for health care coverage through that program at little or no cost to you (in Connecticut, Medicaid clients don’t pay anything for coverage).

QI’m 35, single and earn $37,000 per year. Is there a health insurance plan that covers substance abuse treatment?

AYes. In fact, under Obamacare, all health plans sold or renewed starting this year must cover a set of 10 “essential health benefits,” including substance abuse and mental health services.

Other essential benefits that many individual-market plans didn’t previously cover include maternity care and pediatric dental and vision care.

Any health plan you buy through your state’s exchange or outside the exchange will have to cover those benefits. But depending on your plan’s benefit design, you might have to pay a significant amount of money out-of-pocket when you get care. The lowest-priced plans available to most people shopping on Connecticut’s exchange, for example, have deductibles that are $5,000 or higher, meaning that you’d have to spend $5,000 on medical care before the plan begins covering the costs (with the exception of certain preventive services, which your plan must cover at no charge to you). Plans with higher premiums tend to have lower deductibles, so it might be worth considering the higher monthly fee if you know you’re going to need more services.

Because your income is below 400 percent of the poverty level, you would qualify for a health plan with discounted premiums, as long as you buy your insurance through the exchange. You could still buy a plan outside the exchange, but you wouldn’t get the discount.

Plans that were sold or renewed before Jan. 1 don’t have to cover all the essential health benefits, but those plans can’t be sold to new customers anymore because they don’t meet the health law’s requirements.