Those without health insurance have a lot to consider.
On one hand, the fine for remaining uninsured steeply increases for next year. On the other, the cost of the individual mandate penalty is cheaper than buying the least expensive insurance plan for 7.1 million of the nearly 11 million uninsured eligible to enroll in health exchanges, according to a Kaiser Family Foundation analysis released Wednesday.
The individual mandate fee is a crux of the Affordable Care Act, aiming to serve as a motivator for Americans to sign up for health coverage, particularly “young invincibles” ages 18 to 34. If they don't, they'll be faced with the total cost of their health bills. Yet, just how many people this will incentivize is unclear.
“A key area of uncertainty for 2016 is how much the increased penalties will encourage uninsured people—particularly those who are healthy—to obtain coverage, boosting enrollment in the marketplaces and improving the insurance risk pool,” the Kaiser Family Foundation analysis states.
The individual mandate is being phased in over three years. The fee for those without insurance but who could afford it was comparatively small: $95 per adult and $47.50 per child or 1 percent of a household’s income (whichever was higher). When tax season rolled around, 7.5 million people paid a fine for forgoing health insurance, but most were relatively meager prices, averaging about $200. (About 12 million received exemptions from the individual mandate due to hardships, financial status, and life events.)