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Enrollment Deadline to Avoid Individual Mandate Fine Is Feb. 15

By Rebecca Adams, CQ HealthBeat Associate Editor

October 9, 2013 -- The Obama administration said last week that consumers need to enroll and pay their exchange coverage premiums by Feb. 15 in order to avoid an income tax penalty for not having insurance.

Health and Human Services (HHS) Secretary Kathleen Sebelius has repeatedly mentioned Dec. 15 as a key deadline for consumers who want their benefits to start Jan. 1. And she has stressed that the open enrollment period for the new marketplaces is March 31. But she has not emphasized that Feb. 15 is also a key date.

A short timeline on does not mention February as a key month for implementation of the marketplaces under the law (PL 111-148, PL 111-152).

Since Sebelius has talked about March 31 as the end of open enrollment, many consumers may be under the impression that they would avoid a penalty if they enroll by then. But consumers need to sign up before Feb. 15 if they plan to send in a check by mail so the payment is processed by the deadline.

Even though open enrollment ends March 31, the law says anyone who goes without insurance for three consecutive months during 2014 is subject to a penalty. So someone who signs up for insurance after Feb. 15, wouldn't have a policy in effect until April 1. That means he or she would then be subject to the fine because they were without insurance in January, February and March.

This detail was first reported by the Associated Press.

The shorter-than-commonly-realized time frame could put pressure on HHS officials to delay enforcement of the penalty for people who do not have coverage in 2014. Already, House Republicans have called for a year delay in the individual mandate, saying that it is only fair since the administration decided this summer to hold off for a year on enforcing the penalties for employers who don't offer affordable coverage.

Even comedian Jon Stewart hammered Sebelius over the individual penalty when she appeared on The Daily Show this week. "If I'm an individual that doesn't want it, it would be hard for me to look at big business getting a waiver and not having to do it, and me having to," said Stewart, adding that opponents would think that individuals don't get a waiver because they aren't a strong lobbying force like employers are.

Sebelius never directly answered Stewart's question.

An administration spokeswoman, who was asked if the administration will start highlighting the Feb. 15 date, pointed out language on the website. It says: "If you enroll between the 1st and 15th day of the month and pay your premium, your coverage begins the first day of the next month. So if you enroll on February 10, 2014, your coverage begins March 1, 2014. If you enroll between the 16th and the last day of the month and pay your premium, your effective date of coverage will be the first day of the second following month. So if you enroll on February 16, 2014, your coverage starts on April 1, 2014."

The website does not then clearly state that if someone's coverage starts on April 1 they will be liable for a penalty.

The penalty that starts in 2014 will be 1 percent of someone's income or $95, whichever is more. In 2016, the fine increases to 2.5 percent of income or $695 per person, whichever is higher.

The administration is providing a number of exemptions from the fine, including for religious reasons, if the coverage costs more than 8 percent of household income, or people are too poor to file a tax return. People who are illegal immigrants, in prison, or members of Native American Indian tribes also are exempt.

About 2 percent of Americans are expected to pay the penalty in the first year, administration officials have said.

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