New rule may exempt many from ACA penalty

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New Rule May Exempt Many From Health Plan Penalty
New Rule May Exempt Many From Health Plan Penalty

(HealthDay News) -- Consumers whose individual health insurance policies have been cancelled for failing to meet the minimum requirements of the Affordable Care Act may now apply for a "hardship exemption," Obama administration officials announced late Thursday.

That loophole provides a "temporary" exemption from the law's so-called individual mandate requiring most Americans to have health insurance coverage or pay a federal tax penalty. The exemption also allows people in cancelled health plans to buy bare-bones "catastrophic coverage" if it is available in their area.

The rule change comes just days before a key enrollment deadline. For consumers using the federal and state health insurance exchanges, Dec. 23 is the deadline in most states for enrolling in a health plan that would take effect on Jan. 1.

"Even though the Affordable Care Act will offer more coverage choices and protections for millions of Americans, we are committed to ensuring the smoothest transition possible for those who need to find a new health plan," U.S. Health and Human Services Secretary Kathleen Sebelius wrote in a letter outlining options for people in cancelled health plans. Consumers with cancelled policies may call 1-866-837-0677, a dedicated hotline to help people sort through their options, Sebelius added.

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