Commentary: Since the Affordable Care Act’s inception, different government agencies have released information about how the law is affecting the overall health insurance market. Much of the data has
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The 2014 individual mandate penalty figures are significantly higher than the government’s future projections. The IRS analyzed tax returns from 2014, and found that of the 112 million tax returns processed, 6.6 million indicated an individual mandate penalty payment, with the average penalty payment of $190. According to a Congressional Budget Office
The 2014 rate for the individual mandate was 1%, but will increase to 2.5% in 2016, or approximately $695. Will this increase drive more people toward purchasing coverage who previously chose to pay out the mandate? And will they seek to purchase health benefits through their employers? There are reasons to think the CBO will end up being correct – including the dramatic increase in the penalty amount.
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The penalty and exemption numbers for the 2015 tax filing season will be released by the IRS in July of 2016. Until then it will be interesting to see if the increased individual mandate penalty drives more people to purchase coverage — and if they choose a public exchange or go through their employer.
James Slotnick is assistant vice president of broker education at Sun Life.