R.I. penalty about to kick in for those without health insurance
Katherine Gregg Journal Political Writer kathyprojo
Dec 7, 2019 at 1:16 PM Dec 7, 2019 at 1:16 PM
PROVIDENCE — Warning: if you are a Rhode Islander without health insurance on Jan. 1, 2020, you face a financial penalty.
Gov. Gina M. Raimondo proposed and state lawmakers earlier this year approved a Rhode Island version of the health insurance mandate that was a key part of the Affordable Care Act signed into law by then-President Barack Obama.
The mandate was aimed at making sure most Americans, including the healthiest Americans, enroll in health insurance and pay premiums so there is enough money in the proverbial "pool" to cover the medical bills of the sickest of the sick. But the Tax Cuts and Jobs Act of 2017 effectively repealed the federal individual mandate.
So Democrat Raimondo, who just ended her year run as the chair of the Democratic Governors Association, pushed for a state-level mandate akin to what other Northeast states — including Massachusetts, Connecticut, Vermont and New Jersey — now have, according to the state-run health-insurance marketplace known as HealthSource RI:
Some basics, according to HealthSource RI: www.healthsourceri.com/mandate.
Starting Jan. 1, residents who do not have health insurance for themselves, their spouses and their children will pay a tax penalty. More specifically: "If you (or your dependents) do not have health coverage during the 2020 calendar year, a penalty will be assessed through the Rhode Island personal income tax return that you file in early 2021."
The penalty will be 2.5 % of household income or $695 per adult and $347.50 for each child under the age of 18, whichever amount is higher.
Even if the 2.5% of household income produces a higher number, "the maximum penalty can be no more than the cost of the total annual premium for an average bronze plan sold through HealthSource RI."
"In 2019, the average cost of a Rhode Island bronze plan was $2,388 for a single person and $9,522 for a family of four,'' according to a Senate fiscal office analysis, which described the "bronze plans'' as the ones with the lowest premiums and the highest copays and coinsurance requirements.
There are exemptions from the penalty for people with incomes below the tax filing threshold, and others who seek — and qualify for — a religious conscience or hardship exemption, are in prison or fall into this category: "Not a citizen or national of the United States or an alien lawfully present in the United States."
It is not entirely clear who makes up the pool of Rhode Islanders without health insurance of any kind, including Medicare, Medicaid or private insurance. But 8 out of ten current HealthSource RI customers qualify for some kind of financial assistance, including in some cases, no-cost coverage, according to HealthSource RI data.
Health Source RI estimates "roughly 38,000 people" are uninsured in Rhode Island.
State officials anticipate $9.55 million in new revenue from the penalty payments in 2021 for tax year 2020 from people without health insurance.
The penalty would be collected by the tax administrator and deposited into a restricted account and would be used to provide reinsurance, "or payments to health insurance carriers, as a means of ensuring that premiums do not increase drastically,'' according to the House fiscal office.
The notion: this new "Health Insurance Market Integrity Fund" will pay for some higher-cost insurance claims and that will result in lower premiums for consumers.
It is not yet fully clear how this would work, but in response to Journal inquiries, HealthSourceRI spokeswoman Robin Dionne emailed:
"This year during the rate review process, insurers were asked to submit rates with reinsurance, and without. Without the reinsurance program, average individual rates would have increased up to 7% higher than 2019 rates. With the reinsurance program, on average Rhode Islanders on the individual market will be paying less in premiums in 2020 than they did in 2019. This is the first time in recent history that costs have gone down on average for any consumer group." (It was not immediately clear how the current program is financed.)
Between now and the end of the year, the state-run health exchange has scheduled a series of enrollment fairs, including one scheduled for Thursday at the Rhode Island Shriners' Imperial Room at One Rhodes Place in Cranston from 11a.m. to 7 p.m. where "Rhode Islanders can get answers to their questions, sign up for coverage and even talk to representatives from local health insurance companies. There will also be health and wellness checks at the fair such as bone density, blood pressure, and body fat analysis. "
HealthSource RI is also hosting enrollment events in Cumberland, Newport, Westerly, Warwick, Middletown and North Providence. Details on times and locations for these sessions can be found at HealthSourceRI.com/events.
Rhode Islanders can also sign up for coverage online at HealthSourceRI.com, over the phone at 1-855-840-HSRI and in person at the HealthSource RI Walk-In Center at 401 Wampanoag Trail, East Providence. For the remainder of this month, HealthSource RI is open Monday to Friday from 8 a.m. to 7 p.m. and Saturdays from 9 a.m. to noon.
An option: call 211 to find one-on-one enrollment help at a location nearer to home.