Massachusetts Health Insurance Requirements

Requirement

As a result of the health care reform law, MHRA (MA Health Reform Act) requires all Massachusetts (MA) residents age 18 and over are required to have health insurance if they can afford it.

Eligibility

Residents with limited incomes may eligible to purchase MassHealth or commonwealth Care.  State has decided how much you should spend on health insurance, based on income and family size. (Refer to Schedule HC below.)  If there is no affordable insurance that you can get, you will not face a tax penalty.  You can also request an exemption if you had a hardship during the tax year (and filed for a Certificate of Exemption before December 1) or qualify for a religious exemption.

Penalty

Residents without health insurance face monthly penalties.  The penalties add up each month without health insurance and must be paid with the filing tax return.  Penalties vary by age and income.  The following table shows how much your tax penalty amount will be based on your income range (based on the Federal Poverty Level, FPL)  

Schedule HC

You must file Schedule HC, Health Care Information, when you file your state income taxes to show the insurance coverage.  Residents without health insurance use Schedule HC to request an affordability, religious or hardship exemption. 

Individuals with income at or below 150% of the Federal Poverty Level (FPL) are not subject to a penalty.  Please refer to the table to determine if your income is at or below 150 % of the Federal Poverty Level. (This Schedule reflects the FPL for 2008.)

Employers’ requirement

This law requires employers with 11 or more full-time employees to offer a group health plan to their employees and pay a fair share of the monthly premiums.  Employers who do not obey this law have to pay a Fair Share Contribution of about $295 per employee per year into the Health Safety Net Trust Fund.  In addition, all employers with 11 or more full or part-time employees must set up a Section 125 plan.  A Section125 plan allows employees to buy health insurance with pre-tax dollars through payroll deduction.

Special Circumstances During 2008

Schedule HC must be completed and filed even if you fall into a “Special Circumstances” category.

Turning 18.- If you turned 18 during 2008, the health care mandate applies to you beginning on the first day of the first full month following your birthday.  For examples, if your birthday is September 15, the mandate applies on October 1.

Part-year residents.- If you moved into MA during 2008, the health care mandate applies beginning on the first day of the following month you became MA residents.  If you moved out of MA during 2008, the health care mandate applies to you up until the last day of the last full month you were a resident. 

Deceased taxpayer.- If a taxpayer dies during 2008, the mandate applies to the deceased taxpayer up until the last day of the last full month the taxpayer was alive.

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