By Jocelyn Guyer

Community Catalyst and Georgetown’s CCF have just finished up a piece that explores in detail the way that the new individual responsibility requirement will work.  With all of the controversy and rhetoric surrounding the requirement, it seemed a good time to take an objective, detailed look at how it will actually work. 

Plus, even though it doesn’t go into effect until 2104, we wanted to write about the individual responsibility requirement because it is the foundation on which much of health reform rests.  It allows the country to move forward with popular insurance reforms, such as the ban on excluding people from coverage if they are sick, and plays a major role in expanding coverage.

In working on this Q & A, a few particularly interesting themes emerged, including:

• Nearly everyone is expected to secure coverage, but they won’t necessarily face a penalty if they don’t do so.  Very, very few people are exempt from the individual responsibility requirement.  Just people in prison, with strong, documented religious objections, and undocumented immigrants (who are left out because they are denied help in securing coverage through Medicaid, CHIP and the Exchange.)  But, lots more people are exempt from a penalty if they end up not complying with the requirement, including those who can’t afford coverage, experience shorts gaps in coverage, fall below the tax filing threshold (which hovers around the poverty line, but can be somewhat below or above based on family size), or are native Americans.
• When it comes to children, IRS rules determine who is responsible for getting them coverage.  Parents (or caretakers) are obligated to secure coverage for their children; if they don’t, they may be subject to a financial penalty when they file their taxes.  Interestingly, it is the parent(s) who claims a child as a dependent on the tax form who is responsible for securing her coverage, not necessarily the parent who is living with the child and taking care of her on a daily basis.  While not a big deal for many families, this policy could be a bit complicated in some divorced or never-married families where a non-custodial parent is claiming a child as a dependent for tax reasons.
• The Massachusetts experience with a coverage requirement went surprisingly smoothly. One of the more interesting Q & As in the document is about the Massachusetts experience with a coverage requirement.  Advocates in Massachusetts have dubbed it the “dog that didn’t bark,” reflecting that it has generated relatively little controversy and 98.6 percent of taxpayers properly reported their insurance status on their tax forms. Not everyone is like the residents of the Bay State, and so it may be a different story when 2014 arrives.  But, a very interesting reminder that a coverage requirement that is implemented well and backed up by strong initiatives to make insurance affordable can go surprisingly smoothly.