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Health Care Reform and the Individual Mandate: Are You Ready?

On March 23, 2010, President Obama signed the Patient Protection and Affordable Care Act into law.  A key component of this new health care reform law is the “Individual Mandate” which becomes effective on January 1, 2014 affecting millions of currently uninsured individuals.

The Individual Mandate requires most U.S. citizens and legal residents to have qualifying health insurance coverage by January 1, 2014. Those without coverage will have to pay a tax penalty. The penalty will vary by person based on income and household size. In 2014 the penalty is $95 per person and $47.50 per child up to $285 per family or 1% of the family income whichever is greater. In subsequent years, the tax penalty will be increased and phased-in according to the following schedule:

  • 2014 - $95 or 1% of taxable income
  • 2015 - $325 or 2% of taxable income
  • 2016 - $695 or 2.5% of taxable income

Beginning after 2016, the penalty will be increased annually by the cost-of-living adjustment. Exemptions will be granted for financial hardship, religious objections, American Indians, undocumented immigrants, incarcerated individuals, those for whom the lowest cost plan option exceeds 8% of an individual’s income and those with incomes below the tax filing threshold.

Creation of Health Insurance Exchanges

Another key component of the new health care law is the requirement that all states operate a health insurance exchange by January 1, 2014. The State of Oregon is considered a leader in the country for their efforts in implementing its insurance exchange known as “Cover Oregon”. Individuals who purchase their health insurance coverage through Cover Oregon may be eligible for a Federal Premium Tax Credit to help pay for their health insurance coverage.

The credit is available to individuals and families with incomes between 133% and 400% of the federal poverty level (approximately $44,000 for an individual or $89,000 for a family of four). The credit amount is determined by the Secretary of Health and Human Services and is based on the amount by which premium exceed a threshold amount. The threshold rises from 2% of income for those at 133% of the federal poverty level for the family size involved to 9.5% of income for those at 400% of the federal poverty level. Depending upon your income and household size, some individuals may be eligible for Medicaid which will be made available through the Cover Oregon insurance exchange in 2014.

Cover Oregon - Enrollment

The initial individual enrollment period will be from October 1, 2013 through March 31, 2014 allowing for a broader timeframe for the first year of enrollment through Cover Oregon. Each subsequent year, the individual enrollment period will be October 1st through December 31st allowing for new enrollees to purchase through Cover Oregon and for existing individuals and families to re-evaluate their plan selection and either renew with their current carrier and plan or make a change starting the first of the following year. Individuals will also be allowed to purchase through the exchange if they experience a “qualifying event” such as death, divorce, loss of coverage, etc.

If you’re wondering what your estimated insurance cost or Federal Premium Tax Credit might be, you can find a Plan Saving Calculator on the Cover Oregon website at

Please keep in mind that the illustrated numbers are a preliminary estimate. When Cover Oregon opens in October 2013, you will be able to complete the application process and find out exactly what financial help you might qualify for and how much your premium payment will be.

Rhodes-Warden Insurance Agency “Enrollment Center” Opens October 2013

Here at Rhodes-Warden Insurance Agency, we understand the new health care reform law and have prepared for the changes it presents since its passage in 2010. We also understand that for many individuals the new law might be confusing and may need help in the enrollment application process. That is why we are announcing our new Health Insurance Enrollment Centers to be opened in October 2013 in all three of our insurance offices located in Lebanon, Albany and Stayton, Oregon.

Our new Health Insurance Enrollment Centers will be staffed with experienced, well-trained licensed individuals that are affiliated and qualified to help you place your health insurance coverage with our state’s insurance exchange, Cover Oregon. It is important you know that the cost to purchase your health insurance coverage through Cover Oregon with the help of our enrollment center is no more expensive than it would be otherwise and you will benefit from having a local affiliated agent when you need us. Should that need be a claim, billing or coverage question, we’re here to help. For more information about health care reform or enrollment, please contact one of our offices.


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