VA Health Care and ObamaCare – What Veterans Need to Know
First, the easy part: If you are enrolled in TRICARE, you do not need to do anything different under the Affordable Care Act. Your TRICARE benefits are fully qualified under the terms of the ACA and you don’t need to take any action as long as you are in TRICARE.
For honorably discharged veterans, however, the situation is quite a bit more complicated. Unless you meet certain unusual conditions* the Affordable Care Act requires you to obtain a qualified health insurance policy by March 31, 2014. If you fail to do so, you will be subject to a fine of $95 per adult individual and $49 per family member, up to a max of $285 per family, or 1 percent of family income – whichever is greater.
After Jan 1, 2015, those penalties go up sharply: To $325 per adult and $162 per child, up to a family maximum penalty of $975, or 2 percent of annual income, whichever is less.
The penalty increases again on January 1, 2016. The penalty for that year is $695 per adult and $347 per child, up to $2,085 per family, or 2.5 percent of income, whichever is greater.
I’m a Veteran. Does VA Insurance Count?
Yes, VA insurance counts. But you actually have to enroll in the VA health program to have it qualify. It is not sufficient just to be a veteran. You must take positive steps to make sure you’re enrolled with the VA. Not everybody qualifies. For example, if you’re a Guard or Reserve member, and you’ve never been mobilized, and your only active duty time was for training, you don’t qualify for VA coverage.
Generally, you will qualify if you either served 24 consecutive months on active duty, or for the full period for which you were called for active duty if you were mobilized, and you enlisted after September 7th, 1980.
However, if you didn’t make 24 consecutive months, or had to leave duty early because of a wound or service-related injury, you can still qualify. You aren’t going to get disqualified just because you got hurt.
How to apply for VA coverage.
You aren’t automatically covered just because you are an honorably-discharged veteran, even if you meet the criteria. To enroll, visit the VA Benefits Explorer page on the Web. From that page, you can do a trial run to see if you qualify for VA coverage, and specifically what benefits and price structure you qualify for. (There are no premiums for VA coverage, but you will have to pay some copays and there are limits).
What about family members?
In most cases, the veteran’s family members will not qualify to enroll in the VA health care system. Spouses and children will generally need to obtain qualifying coverage, either through an employer plan or through an individual plan. The individual plan can be purchased either via the online exchanges or through a licensed health insurance agent.
VA Priority Groups
If you qualify, the VA will assign you to one of eight priority groups, based on your location, income and the nature of your service. If you qualify for more than one group, the VA will put you in the higher of the available groups. The groups are listed below:
Priority Group 1
- Veterans with VA Service-connected disabilities rated 50% or more.
- Veterans assigned a total disability rating for compensation based on unemployability.
Priority Group 2
- Veterans with VA Service-connected disabilities rated 30% or 40%.
Priority Group 3
- Veterans who are former POWs.
- Veterans awarded the Purple Heart Medal.
- Veterans awarded the Medal of Honor.
- Veterans whose discharge was for a disability incurred or aggravated in the line of duty.
- Veterans with VA Service-connected disabilities rated 10% or 20%.
- Veterans awarded special eligibility classification under Title 38, U.S.C., § 1151, “benefits for individuals disabled by treatment or vocational rehabilitation.”
Priority Group 4
- Veterans receiving increased compensation or pension based on their need for regular Aid and Attendance or by reason of being permanently Housebound.
- Veterans determined by VA to be catastrophically disabled.
Priority Group 5
- Non-service-connected Veterans and noncompensable Service-connected Veterans rated 0%, whose annual income and/or net worth are not greater than the VA financial thresholds.
- Veterans receiving VA Pension benefits.
- Veterans eligible for Medicaid benefits.
Priority Group 6
- Compensable 0% Service-connected Veterans.
- Veterans exposed to ionizing radiation during atmospheric testing or during the occupation of Hiroshima and Nagasaki.
- Project 112/SHAD participants.
- Veterans who served in the Republic of Vietnam between January 9, 1962 and May 7, 1975.
- Veterans who served in the Southwest Asia theater of operations from August 2, 1990, through November 11, 1998.
- Veterans who served in a theater of combat operations after November 11, 1998, as follows:
- Veterans discharged from active duty on or after January 28, 2003, for five years post discharge
Priority Group 7
- Veterans with incomes below the geographic means test (GMT) income thresholds and who agree to pay the applicable copayment.
Priority Group 8
- Veterans with gross household incomes above the VA national income threshold and the geographically-adjusted income threshold for their resident location and who agrees to pay copays.
Veterans eligibility for enrollment:
Noncompensable 0% service-connected and:
- Subpriority a: Enrolled as of January 16, 2003, and who have remained enrolled since that date and/ or placed in this subpriority due to changed eligibility status.
- Subpriority b: Enrolled on or after June 15, 2009 whose income exceeds the current VA National Income Thresholds or VA National Geographic Income Thresholds by 10% or less
Veterans eligible for enrollment:
- Subpriority c: Enrolled as January 16, 2003, and who remained enrolled since that date and/ or placed in this subpriority due to changed eligibility status
- Subpriority d: Enrolled on or after June 15, 2009 whose income exceeds the current VA National Income Thresholds or VA National Geographic Income Thresholds by 10% or less
Veterans not eligible for enrollment:
Veterans not meeting the criteria above:
- Subpriority e: Noncompensable 0% service-connected
- Subpriority g: Non-service-connected
*Exceptions apply if you are:
- A member of a religious group that is opposed to accepting benefits from an insurance policy
- You are an illegal alien
- You are incarcerated
- You are a member of an Indian tribe
- Your family is below the income threshold for filing an income tax return ($10,000 per individual and $20,000 for family members starting in 2013)
- You have to pay more than 8 percent of your income for health insurance, net of any tax credit or employer contribution.
You may also be exempt if:
- You were enrolled in Medicare, Medicaid or the Children’s Health Insurance Program (CHIP) at any time during the year
- You’re enrolled in TRICARE
- You’re in an employer-sponsored plan
- You have insurance of your own that is “Bronze” level or better,
- You have a grandfathered health plan that was in existence prior to the ACA.
Under the ACA, income is defined as total income in excess of the filing threshold. The penalty is pro-rated by the number of months without coverage. There is no penalty for gaps of 3 months or less. The penalty cannot be greater than the national average cost of a Bronze-level plan offered on the exchanges. (Source: Kaiser Family Foundation).