For middle-class, healthy individuals, forgoing health insurance and paying a tax is cheaper than enrolling in a health plan, according to an Avalere Health report released on April 24.
The analysis included the average premiums for the 34 states in which the federal government runs the health insurance marketplaces.
Under the individual mandate provision in the Patient Protection and Affordable Care Act, most people are required to have insurance. If they do not have coverage, then they have to pay a tax. For 2015, the penalty for being uninsured was the greater of $325 per individual or 2 percent of household income.
The Avalere Health analysis found individuals with incomes at or around the federal poverty level (FPL) of $11,670 would save money by purchasing insurance instead of paying the tax. Those individuals receive subsidies from the government to help pay for insurance and reduce their costs.
However, most people making more than 400 percent of the FPL would save money by paying the tax because it costs less than buying insurance coverage. Still, Avalere Health said its analysis did not account for potential out-of-pocket costs when individuals who do not have insurance get sick or have an accident that requires medical care.
Executive Editor
Tim Casey joined TriMed Media Group in 2015 as Executive Editor. For the previous four years, he worked as an editor and writer for HMP Communications, primarily focused on covering managed care issues and reporting from medical and health care conferences. He was also a staff reporter at the Sacramento Bee for more than four years covering professional, college and high school sports. He earned his undergraduate degree in psychology from the University of Notre Dame and his MBA degree from Georgetown University.