Affordable Care Act deadline not just for uninsured

The March 31 Affordable Care Act deadline has local insurance agents and health coverage officials scrambling to get out what they say is a crucial message that seems to have been lost in the federal law's rollout.

The open enrollment deadline isn't just for those those seeking coverage through state and federally run health exchanges. It applies to all individual and family health plans, including those purchased outside the state's Covered California insurance marketplace.

That means private insurers like Anthem Blue Cross, Blue Shield and Kaiser will not accept applications after March 31, unless you qualify for a special enrollment period.

Local insurance agents and brokers say the barrage of Obamacare publicity has left some people thinking the deadline only applies to subsidized insurance.

"There's very little advertising or notice out there that says if you don't qualify for Covered California, the deadline applies to you too," said Dan Kessler, a Santa Rosa-based licensed independent broker.

"If you're a person who already knows that you're above the income qualifications, you're not paying attention to the ads," he said.

It's a new world under President Barack Obama's signature health care law.

Prior to the Affordable Care Act, there was no enrollment period in the individual health insurance market. People buying health insurance for themselves and their families could sign up at any time of the year, as long as they weren't rejected for pre-existing conditions.

The new deadline for the individual market is part of Obamacare's individual mandate and applies, with a few exceptions, to all who do not have insurance through their employer or a government subsidized program such as Medicare or Medi-Cal, California's version of the federal Medicaid program.

If you don't enroll this year you get a penalty levied on your federal income tax at the end of the year.

Those who did not qualify for Medi-Cal before the Affordable Care Act went into effect could now find themselves eligible.

The law increases eligibility for Medi-Cal from up to 100 percent of the poverty line to up to 138 percent. The law also provides insurance premium subsidies to those making between 138 and 400 percent of the poverty level. The less you make, the bigger the subsidy.

While one of the main goals of the health care overhaul is to expand coverage to millions of uninsured Americans, the law's open enrollment deadline applies to a much broader cross-section of the country that purchase their own individual or family coverage.

Those who enroll by March 31 can get coverage beginning May 1. The regular enrollment window then closes until Nov. 15.

Larry Hicks, a spokesman for Covered California, confirmed Tuesday that the enrollment period applies to all individual health plans, even those that are not products offered through the state health exchange.

The deadline does not apply to:

- Those who are insured through group coverage.

- Those who qualify for Medi-Cal. They can enroll in that program at any time.

- Those who qualify for special enrollment periods because of a "life event," such as getting married, adding a dependent or moving to a different area where the available health plans are different.

Kessler, who operates a website called www.healthplanlink.com and is a certified agent through Covered California, said those who know they don't qualify for a federal health care subsidy can go directly to a health insurer's website or contact a licensed insurance broker.

George Heath, a Healdsburg-based insurance broker who is a certified agent through Covered California, said that some clients he's talked to have toyed with the idea of simply paying the penalty triggered for violating the individual mandate. Heath, who has been in the insurance business for two decades, said some are misguided in thinking it's just a simple flat $95 this year.

Actually, this year the penalty - which is paid on one's federal income taxes at the end of the year - is $95 per person per year or 1 percent of income in 2014. In 2015 it increases to $325 per person per year or 2 percent of income, and in 2016, it's $695 per person per year or 2.5 percent of income.

Thereafter the tax penalty increases by the rate of inflation or 2.5 percent of income.

Local insurance brokers and Covered California officials encourage people to sign up as soon as possible. Next week is likely to be a "nightmare" similar to Obamacare's first deadline of December 23 last year, Kessler said.

Overall, he called it the most frustrating year in his career as a health care insurance agent.

"Ultimately, I think this is going to be a really good thing for the United States," he said. "But it's going to take a while to iron out the bugs, update and amend the law."

You can reach Staff Writer Martin Espinoza at 521-5213 or martin. espinoza@pressdemocrat.com