Image 10



Q     Does the Affordable Care Act require me to buy Health Insurance in 2017 or pay a tax penalty if I do not buy health insurance?

A     Starting in January 2014, most individuals are required to have health insurance or pay a tax penalty if they don’t.   Coverage can include individual health insurance, employer-provided insurance, Medicare or Medicaid.   The tax penalty phases in over three years and becomes increasingly severe.    In 2016, the penalty is 2.5 percent of income or $695 per adult and $347.50 per child up to age 18 (up to a family maximum of $2,085) for the household.   This means that if you do not have coverage in 2016, you will be required to pay a tax penalty when you file your taxes at the end of the year.   The 2017 penalty has not yet been released.

Several groups are exempt from the requirement to obtain coverage or pay the penalty.  Including:

  • People who would have to pay more than 8 percent of their income for health insurance
  • People with incomes below the threshold required for filing taxes (in 2016, $11,770 for a single person and $24,250 for a married couple with two children)
  • People who qualify for religious exemptions
  • Undocumented immigrants
  • People who are incarcerated
  • Members of Native American tribes


Q     Can I purchase a Private Individual and/or Family Health Plan after the end of open enrollment (January 31, 2017)?

A      Most insurance Companies have indicated they will decline to offer Private Individual and/or Family Health Plans through Brokers/Agents within 60 days of a qualifying event.


Q     Is my current Individual and/or Family Health Plan grandfathered?

A     Under the health care reform law, Individual and/or Families have the right to keep coverage they had as of March 23, 2010 and are exempt from many reforms.   These Individual and/or Family plans are considered “grandfathered plans”.    Knowing when the law applies is important.   So it’s important to understand when a plan is “grandfathered”.


Grandfathered plans:  Plans that existed on or before March 23, 2010 the date the law took effect and that continue after that date are considered “grandfathered” plans.   This means the plans may be exempt from some of the requirements of the Affordable Care Act (Obamacare) reform law.   However, certain requirements apply to ALL plans, whether they’re grandfathered or not.


The following requirements apply to ALL plans:

  • No lifetime benefits maximum limits
  • Dependent coverage for adult children up to age 26
  • No annual limits on certain types of benefits
  • No pre-existing conditions exclusions for children under age 19

If certain changes in coverage are made after the law’s effective date, the plan will likely not be a grandfather plan.   This means the plan must also include the following:

  • 100% coverage for preventive care in network
  • No prior authorization for emergency services or higher cost-sharing for out-of-network emergency services

Keeping grandfather status:   According to Affordable Care Axt Guidlines some flexiable is allowed to modify a plan without losing grandfather status.   This includes:

  • Changes to comply with federal or state laws
  • Routine premium changes of a policy or plan to keep pace with medical inflation
  • Adding new benefits and making modest adjustments to existing benefits
  • Changes to voluntarily comply with the Affordable Care Act reform law.
  • Change in third-party administrators
  • Changes in premiums

Losing grandfather status:   The following changes to a plan will result in the loss of grandfathered status:

  • Eliminating all (or substantially all) benefits to diagnose or treat a particular condition
  • Increasing coinsurance by any amount above the level set on March 23, 2010
  • Increasing fixed amount cost sharing (other than co-pays) more than the sum of medical inflation plus 15 percentage points from the level of March 23, 2010
  • Increasing co-pays by an amount that exceeds the greater of 1) a total percentage (measured from March 23, 2010) that is more than the sum of medical inflation plus 15 percentage points, or 2)$5 multiplied by medical inflation, plus $5
  • Reducing an overall annual dollar limit or adding a new overall annual dollar limit, compared with what was in effect on March 23, 2010
  • Ensuring that consumers switch to a grandfathered plan that, compared with the current plan, has fewer benefits or higher cost sharing as a means of avoiding new consumer protections
  • Buying and/or merging with another plan to avoid complying with the Affordable Care Act reform law.

Q     What are the 10 essential Health Plan Benefits required by the Affordable Care Act (Obamacare) to be included in ALL insurance Plans beginning January 1, 2014?

A     1   Ambulatory patient services           

        2.  Emergency services

        3.  Hospitalization                                  

        4.  Maternity and newborn care        

        5.  Pediatric services including dental and vision

        6.  Prescription drugs

        7.  Mental health and substance use disorder services, including behavioral health treatment.

        8.  Preventive and wellness services and chronic disease management

        9.  Laboratory services

      10.  Rehabilitative services and devices


Q     Can I apply for a Federal Government Marketplace subsidy Tax Credit for a  Private Health Plan?

A     No, subsidies will only be available through Government Marketplace Exchanges


Q     Can I apply online for an Advance Premium (subsidy) Tax Credit?

 A     Yes.


Q     How long does it take to get an answer from the  Government Marketplace Exchange to see if I qualify for an Advance Premium (subsidy) Tax  Credit?

A     You should have an answer within 24 hours following the filing of a complete application.


Q     Can I call you if I need help with my online insurance application?

A     Yes,  give us a call if you need assistance in the Houston area 936 321-8286 or toll free 888 780-1215 or e-mail Laura@mcm-healthinsurance.com


Q     If I apply for an Individual and/or Family Health Plan am I obligated to buy that plan?

A     No, you have no obligation to buy anytime we provide you a quote.


Q     Does your organization offer the best premiums for Individual and/or Family Health Plans?

A     YesWe guarantee your premium, for the same health insurance benefits, will be NO greater than if you purchase your Individual/or Family Health insurance directly from  the insurance company or the Government Marketplace Exchange.    PLUS our services are FREE to both our clients and individual seeking health coverage.


Q     Will using your service cost me anything?

A     No, our service cost you nothing


Q     Who is eligible for Advance Premium (subsidy) Tax Credits?

A      Citizens and legal residents of Texas in families with income between 133% and 400% of poverty who purchase coverage through a Government Marketplace Exchange are eligible for an Advance Premium (subsidy) Tax Credit to reduce the cost of coverage.   In states without expanded Medicaid converge, people with incomes less than 100% of poverty will not be eligible for exchange subsidies, while those with incomes at or above poverty will be.   People offered coverage through an employer are also NOT eligible for Advanced Premium (subsidy) Tax Credits unless the employer plan does not have an actuarial value of at least 60% or unless the person’s share of the premium for employer-sponsored insurance exceeds 9.5% of income.   People who meet these thresholds for unaffordable employer-sponsored insurance are eligible to enroll in a Government Marketplace Exchange and may be eligible to receive Advance Premium (subsidy) Tax Credits to reduce the cost of coverage purchased through the Government Marketplace Exchange.


Q     What is the amount of Advance Premium (subsidy) Tax Credit being provided to Individual and/or Families?

A     The amount of Advance Premium (subsidy) Tax Credit that a person can receive is based on the premium for the second lowest cost Silver plan in the exchange area where the person is eligible to purchase coverage.   A Silver plan is a plan that provides the essential benefits and has an actuarial value of 70%.    A 70% actuarial value means that on average the plan pays 70% of the cost of covered benefits for a standard population of enrollment.     The amount of Advance Premium (subsidy) Tax Credit varies with income such that the premium that a person would have to pay for the second lowest cost Silver plan would not exceed a specified percentage of their income (adjusted for family size), as follows:

                              Income Level                                       Premium as a Percent of Income

                             Up to 133% FPL                                              2% of income

                             133–150% FPL                                                3 – 4% of income

                             150–200% FPL                                               4 – 6.3% of income

                             200–250% FPL                                              6.3 – 8.05% of income

                             250–300% FPL                                              8.05 – 9.5% of income

                             300–400% FPL                                              9.05% of income


Q     What happens if a person wants to buy a more expensive Individual and/or Family Health Plan with a greater level of benefits than the second level Silver Plan with their subsidy?

A     A person who wants to purchase a plan that is more expensive would have to pay the full difference between the cost of the second lowest cost Silver plan and the plan that they wish to purchase.

An example shows how the Advance Premium (subsidy) Tax Credit works.  Assume:

  • Robert is 45 years old and has an income in 2016 that is 250% of poverty (about $29,700)
  • The cost of the second lowest cost Silver plan is the exchange in Roberts area is projected to be about $5,733.
  • Robert would not be required to pay more that 8.05% of income, or $2,313 to enroll in the second lowest cost Silver plan.

The Advance Premium (subsidy) Tax Credit available to Robert would be $3,420 ($5,733 premium minus the $2,313 limit on what Robert must pay).


Q     How will Advance Premium (subsidies) Tax Credits be provided to me?

A     Premium (subsidy) Tax Credits would be advanceable.    An advanceable tax credit allows a person to receive assistance at the time that they purchase insurance rather than paying their premium out of pocket and waiting to be reimbursed when filing their annual income tax return.   The subsidy will be paid directly to the insurance company on behalf of the policyholder and the policyholder will pay the net difference between the standard premium of their Health Plan and the Advance Premium Tax Credit.


Q     Am I eligible for cost-sharing subsidies?

A      In addition to the tax credits that reduce your monthly premium payments, you may be eligible for a cost-sharing subsidies in 2017 that may reduce the amount you pay when you get care.   Eligibility for subsidies is based on income level and family size.   You may be eligible for cost-sharing subsidies in 2017 if your projected income is less than about $29,700 for a single person and less than about $60,750 for a family of four in 2016, which represents 250% of the federal poverty level.

Cost-sharing subsidies are offered by the federal government to reduce the amount of money you have to pay for health care expenses such as co-payments or coinsurance.


Q     How is my Income defined in the Federal Poverty formula guidelines to determining if I am eligible for a subsidy?

A      Modified Adjusted Gross Income is a measure used by the IRS to determine if a taxpayer is eligible to use certain deductions or credits.   “Modified Adjusted Gross Income” (NOT “Adjusted Gross Income”) will be used in determining eligibility under the Federal Poverty formula guidelines in calculating  your Advance Premium Tax Credit.                            

How do I calculate my Modified Adjusted Gross Income (MAGI)?   

  1. Calculate your ANNUAL household GROSS INCOME (line 22 of IRS form 1040) which is the income you received from wages, interest and basically any income you made through business,trade or investment
  2. Calculate your ANNUAL household ADJUSTED GROSS INCOME (line 37 of IRS form 1040) Once you have your gross income, you “adjust” it by subtracting qualified deductions from the gross income.
  3. The final step is to calculate your ANNUAL household MODIFIED ADJUSTED GROSS INCOME by adding back certain items to your Adjusted Gross Income including:
  • Deductions for IRA contributions
  • Deductions for student loan interest or tuition
  • Excluded foreign income
  • Interest from EE (employee) savings bonds used to pay higher education expenses
  • Employer-paid adoption expenses

     Note:  For most people the Modified Adjusted Gross Income is the same as their Adjusted Gross Income


Q     What if I qualify for an Advance Premium (subsidy) Tax Credit an my income changes?

A     Your income level determines your eligibility for the Advance Premium (subsidy) Tax Credit to help pay your premium.   If your income changes over the year, your Advance Premium (subsidy) Tax Credit will be adjusted accordingly.   If your income increases, you will have to pay the difference at tax filing time.   It will be important that you stay on top of any income changes so you have an idea of how much you will owe at tax time.


Q      Is this website part of any Federal, State or Local Government?

A       No,  Affordable Health Insurance Exchange is a privately owned health brokerage firm that works in cooperation with the Texas Marketplace Exchange sponsored and operated by the Federal Government Marketplace Exchange and all associated brokers are licensed by the Texas Department of Insurance and Certified by the Federal Government Exchange.


Q      When is Open Enrollment?

A       Open Enrollment for 2017 with the new essential health plans offered by insurance companies in the public and/or private markets and Government Exchange/Marketplace will began on November 1, 2016 and end February 1, 2017 for the earliest effective date of January 1, 2017.