Special enrollment period granted for consumers paying a 2014 individual mandate tax penalty

March 23, 2015

On Feb. 20, the Centers for Medicare and Medicaid Services announced a Special Enrollment Period for consumers who didn’t have health coverage last year and are subject to the individual mandate or “shared responsibility payment” when they file their 2014 taxes.

Impacted consumers can apply for health coverage during the SEP, which starts on March 15, 2015 and ends on April 30, 2015.

What are the eligibility requirements?

Consumers are eligible to participate during this SEP if they live in a state with a Federally Facilitated Marketplace or State Partnership Marketplace and meet the following criteria:

• They are not currently enrolled in coverage through the FFM for 2015.
• They can attest that they paid the fee for not having health coverage in 2014 when they filed their tax returns.
• They can attest that they first became aware or understood the implications of the shared responsibility payment after the end of open enrollment (Feb. 15, 2015) while preparing their 2014 taxes. 

Will those consumers still be liable for the shared responsibility payment?

Yes, they may have to pay a fee for the months they were uninsured and did not receive an exemption in 2014 or 2015.

When does coverage become effective?

The same guidelines used during the regular enrollment period apply.

• For consumers who enroll on or before the 15th of the month, coverage is effective on the first day of the following month.
• For consumers who enroll on or after the 16th of the month, coverage is effective on the first day of the second following month. 

For more information, go to this CMS Press Release. 

The information in this document is based on preliminary review of the national health care reform legislation and is not intended to impart legal advice. The federal government continues to issue guidance on how the provisions of national health reform should be interpreted and applied. The impact of these reforms on individual situations may vary. This overview is intended as an educational tool only and does not replace a more rigorous review of the law’s applicability to individual circumstances and attendant legal counsel and should not be relied upon as legal or compliance advice. As required by US Treasury Regulations, we also inform you that any tax information contained in this communication is not intended to be used and cannot be used by any taxpayer to avoid penalties under the Internal Revenue Code.