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What the Affordable Care Act Means for Vets

Updated for Tax Year 2015


OVERVIEW

The Affordable Care Act is designed to provide all Americans with access to health insurance at reasonable rates, while working to lower costs, improving the quality of health care and improving the coordination of such care. Veterans have a few options to meet the terms of minimum essential coverage under the ACA.


The Affordable Care Act requirements

As of January 1, 2014, Americans who do not qualify for an exemption are required to have minimum essential healthcare coverage or they will be liable to pay a fee when filing taxes. Minimum essential coverage includes many health insurance plans, such as employer-sponsored insurance, individual coverage purchased from the Health Insurance Marketplace and some types of health coverage offered through the Veterans Administration.

how does the affordable care act affect veterans

Qualifying VA healthcare programs

The Veteran's healthcare program, the Civilian Health and Medical Program and the spinal bifida healthcare program, each administered by the VA, qualify under terms of the ACA as eligible programs, so if you’re already enrolled in one of these insurance types through the VA, you meet requirements for coverage. The ACA does not change any benefits you receive and your out-of-pocket costs remain the same. Enrolled vets will be notified by mail by the VA that there are no additional steps needed to comply with ACA standards.

How VA coverage affects other plans

VA coverage can be complemented with private insurance or other federal health insurance coverage, such as Medicare, Medicaid and TRICARE. The ACA does not affect or alter your VA coverage alone or in coordination with other plans. Most TRICARE plans, for example, meet minimum essential coverage requirements on their own. You can continue to use other health insurance if you are already covered, but there is no need to seek out additional coverage beyond qualifying VA plans to comply with ACA requirements.

VA coverage and other family members

Family members who are covered under their employers, TRICARE or some VA programs will also meet the ACA requirements for coverage. Those who are not already covered may want to investigate options through the Health Insurance Marketplace for coverage. They may be eligible for lower premiums, lower out-of-pocket costs, or they may qualify for low-cost or free coverage through Medicaid or the Children's Health Insurance Program. Family members covered under the CHAMPVA program also meet ACA coverage requirements.

The ACA and your tax return

As with most American taxpayers, the Affordable Care Act has no effect on tax returns for veterans with health coverage through a VA program. The premium tax credit applies to insurance obtained through the Health Care Marketplace, so it does not apply to VA coverage.

Starting in the 2014 tax year, uninsured individuals who have affordable healthcare options and don’t meet the requirements for an exemption will pay a fee under the individual shared responsibility provision. VA coverage may be considered an affordable option, if you’re eligible and don't enroll.

Not sure if you are exempt from the tax penalty or from the requirement to purchase health insurance? The TurboTax Exemption Check, is a free, online tool to help determine whether you might be eligible to waive the tax penalty entirely and apply for a health care exemption.

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The above article is intended to provide generalized financial information designed to educate a broad segment of the public; it does not give personalized tax, investment, legal, or other business and professional advice. Before taking any action, you should always seek the assistance of a professional who knows your particular situation for advice on taxes, your investments, the law, or any other business and professional matters that affect you and/or your business.


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