Insurance services group urges preparation for health reform

| September 14, 2011

2014 is the “big year,” TrueNorth said, when state insurance exchanges must be in place. That year is also when the individual mandate goes into effect. Penalties for individuals not having a health-insurance policy will be assessed at tax time, and amount to 1 percent of adjusted gross income in 2014, 2 percent in 2015 and 2.5 percent in 2016.

TrueNorth Account Executive Peter Berg noted three options for a typical 50-year-old, nonsmoking owner-operator currently without insurance, with an adjusted gross income of $50,000 and faced with buying insurance when the individual mandate begins. The operator’s monthly penalty costs will be $42 in 2014, $83 in 2015, and $105 in 2016 if he does nothing.

For limited, high-deductible health insurance, the operator will pay between $119 and $233 a month. If the individual has to buy into the Pre-Existing Condition Insurance Plan between now and then, the cost will be about $214 to $559 monthly.

Cost is a major question of whether the state health insurance exchanges actually will deliver on their promise of injecting greater competition in the health-insurance system, Berg added.


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