Tuesday, October 8, 2013

Obamacare and Immigration

Over the past few weeks, the public has been inundated with information about Obamacare.  We have heard of new health care exchanges, tax credits, tax penalties, changes to Medicaid, but it is difficult to understand exactly how Obamacare works—especially how it works for immigrants. 

What is Obamacare?

Obamacare, or more formally, the Patient Protection and Affordable Care Act (ACA), is a health care reform law enacted in 2010.  The changes under the law to the current U.S. health care system come in stages—some parts of the law were implemented right away and some will be implemented years after the law was enacted.  The most recent news coverage about Obamacare refers to the implementation of the new health insurance marketplace or the “exchange.”  The exchange offers health insurance plans of various coverage levels (labeled bronze, silver, gold, and platinum) for those individuals who do not receive health coverage through employment or Medicaid.  The health insurance plans offered on the exchange will vary from state to state. 

Obamacare will also offer a tax credit in 2014 to those individuals and families with incomes between 100% and 400% of the federal poverty level (about $23,000 to $94,000 for a family of four).  This tax credit will help cover monthly premiums and may be used towards the purchase of any plan sold on the exchange. 

Additionally, Obamacare will offer two types of cost-sharing subsidies in 2014.  The first is available to those individuals and families with incomes between 100% and 400% of the federal poverty level, who purchase silver-level insurance through the exchange.  This first type of subsidy is meant to reduce out-of-pocket exposure by reducing the maximum cap set for consumer out-of-pocket spending under a health care plan and is paid directly to the insurer.  Obamacare also provides a second cost-sharing subsidy to individuals and families who earn up to 250% of the federal poverty level (about $58,875 for a family of four) and purchase silver-level insurance through the exchange that will help reduce their deductible and co-pays even if they do not come close to reaching the maximum expense cap.  

In 2014, those who do not have health insurance coverage may have to pay a tax penalty.  The tax penalty could be as low as $95 in 2014 but may be more depending on the uninsured’s income.  The minimum tax penalty will increase each year until 2016.  This tax penalty is also referred to as the individual mandate.  Certain exceptions apply, including exceptions for those who are uninsured for less than 3 months, those who do not have to file a federal tax return, or those who would have qualified for Medicaid but their state did not expand the program.

Finally, the ACA permits states to expand their Medicaid programs to cover all people making up to 138% of the federal poverty level (about $33,000 for a family of four). 

But how do these changes in the U.S. health care system affect immigrants?  Below I have outlined the eligibility requirements—both those that have changed and those that remain unchanged by the ACA—for immigrants and naturalized citizens.

Who is covered?

Naturalized Citizens and Lawful Permanent Residents for 5 Years or More

·       Eligible to purchase insurance through exchange

·       Subject to tax penalty if do not have health insurance coverage, unless exception applies

·       Low-income individuals eligible for tax credit and cost-sharing subsidies*

·       Low-income individuals eligible for Medicaid*

Lawful Permanent Resident for 5 Years or Less

·       Eligible to purchase insurance through exchange

·       Subject to tax penalty if do not have health insurance coverage, unless exception applies

·       Low-income individuals eligible for tax credit and cost-sharing subsidies*

·       Not eligible for Medicaid until have held green card for more than 5 years

o   Individual states may eliminate the 5-year waiting period for eligible children and pregnant women but not for other adults

Refugees/Asylees

·       Eligible to purchase insurance through exchange

·       Subject to tax penalty if do not have health insurance coverage, unless exception applies

·       Eligible for tax credit or cost-sharing subsidies*

·       Low-income individuals eligible for Medicaid*

Non-immigrant Visa Holders

·       Eligible to purchase insurance through exchange for coverage extending through period of authorized stay

·       Subject to tax penalty if do not have health insurance coverage, unless exception applies or if not present in the U.S. for whole period of enrollment

·       Eligible for tax credit or cost-sharing subsidies*

·       Not eligible for Medicaid

Undocumented Immigrants and Deferred Action for Childhood Arrivals (DACA) Recipients

·       Not eligible to purchase insurance through the exchange

·       Not subject to tax penalty

·       Not eligible for Medicare, nonemergency Medicaid, CHIP (assistance for children and pregnant women)

*Other eligibility requirements apply.

Other individuals who are eligible to purchase insurance through the exchange and whp are subject to the tax penalty include:  asylum applicants who have work authorization, applicants for temporary protected status (TPS) who have work authorization, applicants for adjustment of status, applicant for withholding of deportation or withholding of removal under CAT, those granted a U visa or status through VAWA, and those who have an administrative order staying removal.  Immigration status will be verified with the USCIS before any benefit is granted. 

For more information about how the ACA affects you and how to access the exchange, please visit https://www.healthcare.gov/ or for Spanish speakers, https://www.cuidadodesalud.gov/es/. 

By: Kelli Stout
Associate Attorney
The McCrummen Immigration Law Group, LLC

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