Fines Push Massachusetts Residents to Get Health Insurance

When the year began almost a month ago, Massachusetts residents who didn’t have health insurance faced the possibility of being levied with monthly fines that could total almost $2,000 for married couples or almost $1,000 for individuals by the end of 2008.By comparison, those who had failed to sign up for health insurance by the end of 2007, only faced a one-time loss of a personal income tax exemption of roughly $219.

These fines are part of the state of Massachusetts’s plan to pressure their residents into getting health insurance, and are included in a law signed by former Governor Mitt Romney in 2006. The mission is near-universal insurance coverage within the State, but at this point it is unclear how many people remain uninsured. Estimates put the number in the hundreds of thousands.

The penalties vary with income and age and are based on the half of the lowest-cost plans available through the Health Care Connector. They accrue monthly as long as an individual remains uninsured, and will be due as part of the State tax returns in 2009. They are only applicable to those adults who are deemed able to afford health insurance by the agency that oversees Massachusetts health care law: the Health Insurance Connector Authority.

The highest fine of $76/month ($912/year) is levied against adults who are over the age of twenty-seven years who make at least three times the federal poverty level income of $30,636. Married couples who are both uninsured will be assessed individual fines – a couple earning more than $41,076 would pay the highest fine: $1824 / year. The fines drop for younger adults, and those making less than three times the poverty level, with no fines for those who are earning less than $15,325 / year. People can apply for hardship appeals if their situations warrant it.

John McDonough, the executive director of Health Care for All, an advocacy group says that the penalties, as currently structured, are a good compromise between the original law, which would have given 59-year-old residents a penalty up to six times higher than younger adults.

No one knows how many taxpayers will actually face fines, but it is estimated that roughly 300,000 Massachusetts residents who were previously uninsured now have health care coverage.