What the Affordable Care Act Delay Means for Consumers

I saw in the news that the Obama administration has delayed the implementation of the Affordable Care Act’s mandate for most businesses to provide health coverage starting on January 1, 2014. That part of the law now won’t kick in until January 2015. Does this mean I won’t be penalized if I don’t have health insurance by January?

No. This news affects businesses much more than it does consumers. Employers with 50 or more full-time employees won't be subject to penalties if they don't provide health coverage next year. Workers whose companies continue not providing health insurance in 2014 will be able to buy coverage on the state-based exchanges -- and if you don’t sign up for coverage, you will have to pay a fine. (Even if the 2014 mandate had remained, some full-time workers would have had to shop for insurance on the exchanges because some employers seem willing to pay penalties rather than provide the mandated coverage.)

Health Care Reform Could Cost You

It is “extremely unlikely” that companies already offering health insurance will use this opportunity to drop coverage until 2015, according to editors of The Kiplinger Letter.

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For health-care consumers (that’s pretty much all of us), everything remains the same for now:

-- If you already have health insurance through your employer, you’ll probably see few changes in 2014 specifically because of the health care law (although premiums may continue to rise, as they have for the past several years ).

-- If you buy health insurance on your own, open enrollment for the exchanges is still scheduled to begin on October 1 for coverage to start on January 1. Learn more about shopping for insurance on the exchanges.

Starting in 2014, insurers will no longer be allowed to reject anyone for coverage or charge them more because of their health. The law also sets limits on how much insurers may charge older buyers. For example, premiums for a 64-year-old can be no more than three times as much as they are for a 21-year-old.

-- People whose modified adjusted gross income is between 100% and 400% of the federal poverty level can qualify for subsidies to buy coverage on the exchanges (if they don't have other coverage that meets certain standards). Learn more about whether you might qualify for a subsidy.

-- Individuals who choose not to have health insurance will still be subject to a fine -- 1% of your yearly income or $95 per person for the year, whichever is higher. The penalty gradually increases until 2016, when it is 2.5% of your income or $695 per person, whichever is higher.

As the "Ask Kim" columnist for Kiplinger's Personal Finance, Lankford receives hundreds of personal finance questions from readers every month. She is the author of Rescue Your Financial Life (McGraw-Hill, 2003), The Insurance Maze: How You Can Save Money on Insurance -- and Still Get the Coverage You Need (Kaplan, 2006), Kiplinger's Ask Kim for Money Smart Solutions (Kaplan, 2007) and The Kiplinger/BBB Personal Finance Guide for Military Families. She is frequently featured as a financial expert on television and radio, including NBC's Today Show, CNN, CNBC and National Public Radio.