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Health insurance enrollment deadline is midnight Monday - or face tax penalty

March 26, 2014 Updated: March 26, 2014 at 7:41 pm
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Customer representatives answer phone calls Tuesday, Oct. 22, 2013, at the Colorado Springs call center for Connect for Health Colorado. (The Gazette, Christian Murdock)

Jay Vitkus procrastinated for months while mulling his options: Buy health insurance or face a tax penalty.

"I'm just one of those people who tends to wait until the last minute," said Vitkus, of Manitou Springs.

The clock is ticking.

Coloradans have until midnight Monday to enroll in health care coverage - be it Medicaid, which is available for low-income residents, or private health insurance. But that deadline appears far from solid, officials overseeing Connect for Health Colorado signaled this week, and some Coloradans could get an extra two weeks to purchase insurance plans for coverage beginning May 1.

Should shoppers encounter problems with the state's Medicaid website before Monday's deadline - a mandatory stop for people seeking federal insurance subsidies - they will be given extra time to complete it, said Rachel Reiter, spokeswoman for the Colorado Department of Health Care Policy and Financing.

As of Tuesday, 60 to 70 percent of people who submitted an online Medicaid eligibility form received an instant response, Reiter said. Most inquiries were resolved within two business days, she added.

In addition, anyone who creates an account on the state's exchange will be given until April 15 to finish their enrollment, said Ben Davis, an exchange spokesman.

For example: A person who created an account in October will be given until April 15 to purchase a plan, he said.

"In reality, customers who have some history with us, or with an assistance site, we'll work with," Davis said.

Of the 219,021 exchange accounts created through March 17, slightly less than half - 100,112 - have resulted in enrollments, according to the exchange's website.

Officials overseeing Medicaid and the state's health insurance exchange, Connect for Health Colorado, stressed this week that their websites are ready for a deadline-driven rush of shoppers.

For many uninsured Coloradans, the decision to enroll amounts to a question of economics, observers said. How much will shoppers save by paying a tax penalty versus monthly insurance premiums? And will they be willing to endure the risk of costly medical bills in the event they get sick or injured this year?

For a time, Vitkus wavered - like many Coloradans, the prospect of paying $95 to go without health insurance this year seemed like a relatively easy pill to swallow.

That perception can carry a hefty price tag, experts say.

For many Coloradans, the Affordable Care Act's penalty for not carrying health insurance likely stretches far beyond the $95 figure that many people reference when choosing to avoid health insurance plan this year. In reality, tax experts warn, the law mandates the greater of two tax penalties for 2014: $95 or 1 percent of a family's taxable income.

Most likely, the latter category will apply come tax season, said Michael Micheletti, a spokesman for H&R Block.

"Next year, this time, there's going to be a lot mad people," Micheletti said.

In general, individuals making more than $19,650 in 2014 will pay more than the $95 fine for not carrying health care coverage, according to Internal Revenue Service. Same goes for couples making more than $29,800.

Those figures can vary from person to person, though, due to complex tax regulations that can take several other factors into consideration, Micheletti cautioned.

People covered by Medicare and Medicaid - which expanded to include everyone making 138-percent of the federal poverty level, or roughly $16,000 - won't face the penalty, and Medicaid enrollment continues year-round.

There also are exceptions to the insurance mandate. For example, people who are undocumented immigrants, members of federally-recognized Native American tribes or some people who have federally-recognized religious objections to insurance won't be required to pay.

The prospect of greater-than-expected penalties contributed, in part, to a surge in shoppers visiting health coverage guides at the Pikes Peak Area Council of Governments, said Lisa Hietala, who oversees the insurance assistance site.

Increasingly, visitors said they decided to get insurance after re-calculating their tax penalties, she said.

"People are becoming more surprised about it," Hietala said.

Vitkus visited the assistance site twice - finally arriving on a $45-a-month estimate for purchasing a silver-tiered plan from Humana, when factoring in federal subsidies, he said.

At first, he hedged: For the past few years, he sought care from Peak Vista Community Health Centers and SET Family Medical Clinics - two safety-net clinics whose job it is to serve low-income residents and the uninsured. He figured he could continue seeing them for any small medical needs that arise in the coming year.

But he considered his age - at 61, he lies at a far greater risk for serious illness than someone who is younger, he said.

Exchange officials have voraciously sought "young invincibles" - people ages 18 to 34 who are generally thought to be healthier, thus balancing insurance risk pools in 2015 and theoretically keeping insurance rates low.

So far, that demographic's enrollment figures have been troublesome, observers say. Through March 17, 24 percent of enrollees fit the "young invincibles" category.

Meanwhile, 29 percent of enrollees were ages 55 through 64.

"We'd certainly like to see a more leveled or balanced enrollment among the population," said Adam Fox, with the Colorado Consumer Health Initiative. "But I think, again, there's still a week for people to enroll."

Vitkus says his days of waiting are over. Sometime this week, he plans to purchase the plan through Colorado's exchange.

"At $50 a month, there's really nothing to complain about," Vitkus said. "So just looking at the face of it, it just only makes sense for me to get on board."

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