ACA penalty might not motivate the uninsured

NEWS IN BRIEF — Posted May 6, 2013

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Most people without insurance do not appear to be concerned about being penalized under the Affordable Care Act’s individual health insurance mandate, according to a recent survey of more than 1,000 people by HealthPocket.

Starting in 2014, the Internal Revenue Service will levy a fine against people who fail to obtain health insurance, although some exceptions will be made based on financial hardships or other circumstances. The penalty starts at the greater of $95 per person or 1% of household income, and then increases to the greater of 2.5% of annual household income or $695 per individual by 2016.

When asked if the penalty would prompt them to shop for health plans this fall, the time when open enrollment begins on health insurance exchanges, nearly two-thirds of the survey participants said no, and just 8% said yes. Thirty percent said they weren’t sure what they would do.

HealthPocket is based in Sunnyvale, Calif., and offers free resources to help people compare and contrast individual health plans. Bruce Telkamp, the company’s CEO, said the ACA’s effectiveness depends on whether consumers “see real value in obtaining the insurance coverage. Only insurers that offer high-quality and affordable health plans should expect to see significant new enrollments this fall.”

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