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Minimum Health Insurance Coverage

Under the Affordable Care Act, main medical health insurance plans and qualified health plans (QHPs) must meet the Minimum Essential Coverage Standards, which typically means they must:

1. Have an “Actuarial Value” of 60% or more
2. Cover 10 Essential Health Benefits

The individual mandate (which necessitates most Americans to carry a minimum level of health coverage) is still in effect even after its repeal in the GOP’s tax bill.

 Minimum Essential Coverage

Under the Patient Protection and Affordable Care Act (PPACA), the federal government, state governments, insurance companies, employers, and individuals each are provided roles in reforming and improving the availability, quality, and affordability of health insurance coverage in the United States. Beginning January 1, 2014, the individual shared responsibility provision called for every person to have minimum essential health coverage (referred to as “minimum essential coverage”) for every month, qualify for an exemption, or make a payment when filing his or her federal income tax return.

Under the Tax Cuts and Jobs Act, which was legislated on December 22, 2017, the individual shared responsibility payment was lowered to $0, effective for months after December 31, 2018. Hence, beginning with the 2019 tax year, taxpayers will not have to pay the individual shared responsibility payment if they do not have minimum essential coverage or qualify for an exemption. Nevertheless, some consumer protections under federal law continue to depend on whether somebody has minimum essential coverage. For instance, certain special enrollment periods to enroll in coverage in the individual market outside of the annual open enrollment period are only available to people who had or lost minimum essential coverage.

Categories of Minimum Essential Coverage

Minimum essential coverage designated by statutes or regulations consist of the following:

• Employer-sponsored coverage (as well as Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage and retiree coverage)
• Coverage bought in the individual market, including a qualified health plan provided through the Health Insurance Marketplace.
• Medicare Part A coverage and Medicare Advantage (MA) programs
• Many Medicaid coverage
• Children’s Health Insurance Program (CHIP) plan
• Certain forms of veterans health coverage administered by the Veterans Administration
• TRICARE
• Coverage offered to Peace Corps volunteers
• Coverage under the Nonappropriated Fund Health Benefit Program
• Refugee Medical Assistance supported by the Administration for Children and Families
• Self-funded health coverage provided to students by universities for plan or policy years that start on or before December 31, 2014 (for later plan or policy years, sponsors of these programs may apply to HHS to be recognized as minimum essential coverage)
• State high-risk pool insurance established on or before November 26, 2014, in any State

National health programs of other nations are not a PPACA-recognized category of minimum essential coverage. A country that wants its national health plan to be accepted as minimum essential coverage must apply and have it approved.

Resources and References:

• Children’s Health Insurance Program
• Patient Protection and Affordable Care Act