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FAQs

Frequently Asked Questions About the New Massachusetts Health Care Reform Law

HEALTH CARE REFORM

On April 12, 2006, Massachusetts signed into law a new Health Care Form Bill – Chapter 58 of the Acts of 2006 : An Act Promoting Access to Affordable, Quality, Accountable Health Care. The law requires that as of July 1, 2007 all residents of the Commonwealth, 18 years of age and older, are required to maintain health insurance.

What is the Individual Mandate?
If an individual does not comply with the Individual Mandate, what consequences will he/she face?
What is Minimum Creditable Coverage?
Are there exceptions to the Individual Mandate?

What is the Individual Mandate?

The individual mandate is a requirement that all Massachusetts residents aged 18 and over obtain and maintain health insurance that meets minimum coverage requirements beginning July 1, 2007.

The State will enforce compliance by requiring residents to report on their State income tax forms whether they have maintained health insurance. Individuals cannot be without insurance for any period greater than 63 days.

If an individual does not comply with the Individual Mandate, what consequences will he/she face?

Individuals who cannot show proof of health insurance coverage by December 31, 2007, will lose their personal income tax exemption when filing their 2007 income taxes. Failure to meet the requirement in 2008 will result in a fine for each month the individual does not have coverage. The fine will equal 50% of the least costly, available insurance premium that meets the standard of creditable coverage. The Department of Revenue will enforce the individual mandated through the tax collection process.

What is Minimum Credible Coverage?

"Minimum Credible Coverage" establishes the lowest threshold health benefit plan that an individual must purchase in order to satisfy the legal requirement that a Massachusetts Resident has health coverage.

Effective January 1, 2009, individuals must have coverage that meets the definition of "minimum credible coverage" as determined by the Connector Board. Individuals whose coverage does not meet those minimum standards will be out of compliance with the individual mandate and subject to the penalties referenced above. Prior to January 1, 2009, the individual mandate will be satisfied by having coverage under any plan that is legally offered in Massachusetts.

For further information and full regulations, refer to Massachusetts 956 CMR 5.00

Are there exceptions to the Individual Mandate?

An individual may file a sworn affidavit with his income tax return stating that he/she did not have creditable coverage during the 12 months of the taxable year for which the return was filed because of sincerely held religious beliefs.

Additionally, an individual may be exempt from the mandate on the basis that he/she is unable to afford health insurance that meets minimum creditable coverage. Guidance affordability and what constitutes minimum creditable coverage will be forthcoming.