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Higher Financial Penalties Proposed for Uninsured Massachusetts Residents

January 11, 2013
Related Topics: Health Care Reform, Finance/Taxes, Health and Wellness, Health Care Benefits, Latest News

Massachusetts residents who do not have health insurance will face a higher financial penalty in 2013 under newly proposed rules.

Under the proposal by the Massachusetts Department of Revenue, the maximum penalty this year for those with incomes that exceed 300 percent of the federal poverty level will be $106 for each month that an individual is not covered by health insurance, or $1,272 a year.

In 2012, the maximum penalty for non-compliance was $105 a month, or $1,260 a year.

Penalties for those with incomes that are less than 300 percent of the federal poverty level would also go up by $1 a month compared to 2012. For example, the monthly 2013 penalty would be $20 for those with incomes between 150 percent to 200 percent of the federal poverty level, $39 a month for those with incomes between 200.1 percent and 250 percent of the federal poverty level and $59 a month for those with incomes 250.1 percent and 300 percent of the federal poverty level.

Penalties, though, do not apply for individuals whose incomes are less than 150 percent of the federal poverty level, which is $16,764 for an individual and $33,516 for a family of four. Those individuals are eligible for free health insurance coverage, with premiums paid by the state.

Imposing penalties on those without health insurance is a key part of the 2006 Massachusetts health care reform law, with the goal of moving the state very close to universal coverage. Last September, the U.S. Census Bureau reported that at 3.4 percent, Massachusetts in 2011 had the lowest uninsured rate of any U.S. state.

Massachusetts Gov. Deval Patrick this week proposed eliminating the $295 per full-time employee penalty on employers that do not offer coverage, saying that will be unnecessary due to the federal health care reform law.

Under the Patient Protection and Affordable Care Act, employers, starting in 2014, are liable for a $2,000 per full-time employee penalty if they do not provide coverage.

Gov. Patrick, though, has not proposed eliminating penalties on individuals who do not enroll in a health care plan.

Jerry Geisel writes for Business Insurance, a sister publication of Workforce Management. Comment below or email

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