People in 36 of Mississippi's 82 counties may not be able to buy health insurance through the new federal online marketplace when it starts enrolling customers in October. Insurance Commissioner Mike Chaney says two insurers have announced offerings so far, planning to serve 46 counties.
Unless more companies sign up or the existing companies expand their plans, consumers in the remaining counties won't be able to buy health insurance through the online exchange. Coverage under those policies begins Jan. 1.
"I don't know what to tell you about the other 36 counties," Chaney told The Associated Press in a phone interview this week. "You're just out of luck."
That means they won't be able to use federal tax credits offered to consumers with incomes of between 133 percent and 400 percent of the federal poverty level. That's up to about $46,000 for an individual and about $94,000 for a family of four, with those at the top end getting little or no subsidy.
People who don't buy insurance are required to pay a $95-a-year penalty starting in 2014. A spokeswoman for the U.S. Treasury Department couldn't immediately say Thursday whether people would be penalized in counties without offerings.
My reading of the statute is that this should have little effect on the penalties that Mississippians face under Obamacare, since the state's refusal to establish an exchange has already exempted 128,000 residents from penalties under the individual mandate, and all Mississippi employers from penalties under the employer mandate.
But assuming the IRS gets away with illegally offering Obamacare's penalty-triggering "premium assistance tax credits" in states that have refused to establish exchanges, Mississippi employers cannot be penalized for failure to provide "affordable" health insurance to residents of those 36 counties because without any exchange at all, those residents will not be able to receive the tax credits. But employers could be penalized for failing to provide those residents "minimum value" coverage--if a firm employs even a single person in one of the other 46 counties that do receive such a tax credit.
Individuals would still seem to be subject to the individual mandate as they otherwise would. But without an exchange, fewer of them would qualify for the unaffordability exemption from the individual mandate, because there would be no "annual premium for the lowest cost bronze plan available in the individual market through the Exchange" with which to calculate whether they are eligible for that exemption. Of course, the federal Department of Health and Human Services could just throw residents of those counties a hardship exemption.