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Trump and Obamacare: The Law Still Requires You to Purchase Health Insurance

President Trump scored a major victory Thursday when the House narrowly passed a bill to repeal and replace Obamacare after failing to garner enough Republican support earlier this year to even bring a bill to the floor for a vote.

According to The Washington Post, the bill just passed by the House would give states more power to set important health insurance rules and end subsidies for most people who buy health plans through marketplaces. It also would rescind several taxes that have helped pay for Obamacare and loosen the laws for insurers regarding pre-existing conditions.

"This has really brought the Republican Party together," said Trump during a press conference after the House vote. "As much as we've come up with a really incredible health care plan, this has brought the Republican Party together. We're going to get this finished."

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It was the narrowest of victories for the GOP, with 217 Republicans voting to pass the pill — just one more than the needed 216.

“We are all breathing a sigh of relief,” Rep. Chris Collins, New York Republican, told the New York Times after the vote. “We’re living up to a campaign promise we made, the Senate made, the president made.”

Collins’ Senate remark was a jab across  the aisle now that legislation moves to the upper chamber for consideration.

It’s expected to be a tougher and much longer battle for the Trump-backed plan in the Senate.

Don’t expect the Senate to move quickly. There’s still plenty of disagreement and rancor among lawmakers on how to proceed with this bill and debate has to wait until a review from the Congressional Budget Office, which could take several weeks.

That means Obamacare, at least for now, still in place.

Why Trump's executive order didn't kill Obamacare

Many thought Trump's executive order earlier this year was the first step at a quick repeal and replacement of Obamacare. That wasn't the case.

Essentially what Trump's order did was direct federal agencies to minimize the financial burden of Obamacare across a range of groups, including states and insurance companies.

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What does that mean? Not much for consumers.

An executive order can’t undo Obamacare. That’s a job for only Congress and lawmakers obviously can't seem to agree on a repeal or a replacement leaving Obamacare as law.

That means Americans still are required to have insurance or face penalties, so you still need to shop around for health insurance if you don't have any or are paying too much for your current policy.

Anyone who signed up for Obamacare during the last open enrollment will still be covered for the upcoming year.

How much is the penalty for not having insurance?

U.S. residents who skip insurance face a fine, and the Obamacare penalty for 2016 for a household is the greater of either: $695 per adult plus $347.50 per child or 2.5 percent of your household income minus the amount of the minimum filing threshold, which is the lowest income at which you need to file taxes. The same fines apply for 2017.

The penalty is capped at $2,085, the average annual premium for a Bronze health insurance plan sold in the ACA marketplace.

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If you didn't have health insurance in 2016, how much will you be fined? The penalty must be calculated in two ways, using the flat dollar amount and the income formula.

1. Flat dollar amount − Calculate the amount you’d owe based on paying the individual penalty amount of $695 for each adult plus $347.50 for each child under 18. Add those numbers for your household to get a total.

2. Income formula  Take your household income minus the minimum filing threshold amount for the year, which is the income above which the IRS requires you to file income taxes. The most recent number available, from 2015, is $10,300 for a single person and $20,600 for a married couple. Calculate 2.5 percent of that number to get a total.

Compare your flat dollar total to your income formula total. The larger number is your Obamacare penalty.

However, calculating the penalty is more complicated if you lacked health insurance for only part of the year. If you went without coverage for only one or two months, you won’t have to pay a penalty due to the short gap exemption.

To help crunch the numbers, insuranceQuotes has an Obamacare Penalty Calculator to help you easily understand the penalties.

Obamacare penalty calculator

Use our quick calculator to estimate your penalty for not having health insurance.

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