Individual Health Insurance


Individual insurance policies may be purchased through an exchange or “marketplace” or they may be purchased outside of the exchange. Irrespective of whether a policy is purchased inside or outside the exchange, polices must cover the same set of Essential Health Benefits. The richness of the benefits under the plan is defined by a metal tier. These tiers are based on the percentage the plan pays of the average overall cost of providing essential health benefits to members:

  • Platinum plans are the most generous and more expensive.

  • Gold plans are designed to pay 80% of medical expenses.

  • Silver plans are expected to pay 70% of medical expenses.

  • Bronze plans are expected to pay 60% of medical expenses.

Individual Mandate FAQ’s

What the penalty for not having health insurance in 2016 & 2017?

The fee is calculated 2 different ways – as a percentage of your household income, and per person. You’ll pay whichever is higher.

Percentage of income

2.5% of household income

Maximum: Total yearly premium for the national average price of a Bronze plan sold through the Marketplace

Per person

$695 per adult

$347.50 per child under 18

Maximum: $2,085

How is the fee paid?

Using the percentage method, only the part of your household income that’s above the yearly tax filing requirement is counted.

Using the per-person method, you pay only for people in your household who don’t have insurance coverage.

If you have coverage for part of the year, the fee is 1/12 of the annual amount for each month you (or your tax dependents) don’t have coverage. If you’re uncovered only 1 or 2 months, you don’t have to pay the fee at all. Learn about the “short gap” exemption.

You pay the fee when you file your federal tax return for the year you don’t have coverage.

What happens if i dont pay the fee?

The IRS will hold back the amount of the fee from any future tax refunds. There are no liens, levies, or criminal penalties for failing to pay the fee.

What if i buy a plan outside of the market place?

Any plan that meets the standards for qualifying health coverage counts under the health care law. If it does, you won’t have to pay the fee.

You can buy qualifying health coverage directly from an insurance company, from an online seller, or through an agent or broker.