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How to Report Life Changes for the Affordable Care Act

        Health | Family Care

Mercy Cabrera, an insurance agent with Sunshine Life and Health Advisors, speaks on the phone with someone requesting information about an insurance policy under the Affordable Care Act.
Mercy Cabrera, an insurance agent with Sunshine Life and Health Advisors, speaks on the phone with someone requesting information about an insurance policy under the Affordable Care Act.
Joe Raedle/Getty Images

Designed to offer affordable health care to all Americans, the Patient Protection and Affordable Care Act (ACA) was signed into law in March 2010 and launched on Jan. 1, 2014 (although some provisions went into effect earlier). The ACA expands Medicaid and provides tax subsidies to help the lower- and middle-class get health insurance for themselves and their families.

Americans seeking health insurance can do so via the ACA website Healthcare.gov -- also called the health insurance marketplace -- during a period of open enrollment each year. If you're looking for health insurance, you fill out a survey, and the marketplace tells you which health insurance program(s) work for you. Depending on your income, you may also qualify for tax benefits that will lower the cost of your insurance.

The ACA also enacts a tax penalty on those who don't have health insurance, either through the ACA or their own private insurance. The penalty for 2014 is either 2 percent of your income, or $325 per adult ($162.50 per child) -- whichever is higher [source: Healthcare.gov].

You may only sign up for insurance through the health insurance marketplace during its open enrollment period. Typically, open enrollment for the new year starts in November of the previous year, and ends three months later in February. If you enroll during November or December, your health insurance starts on January 1.

However, you can change your health insurance outside of the open enrollment period if you have a life change, such as a marriage, childbirth or adoption, divorce, or change in income. Any life change must be reported to the marketplace, whether you plan to change your health insurance plan or not -- because it may affect your tax credits.

Keep reading to learn about how the ACA calculates tax credits, and how to report any life changes.


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