Who must buy a health insurance plan under the Affordable Care Act? Are seasonal workers and Green Card holders obligated by law to obtain coverage? Who can shop the exchanges and take advantage of income-based financial assistance to lower health insurance costs? These are common questions when it comes to the healthcare law and immigration status.
When it comes to who must have health insurance that fulfills the Affordable Care Act’s individual shared responsibility provision, the answer is most Americans. This requirement extends beyond U.S. citizens to others legally living and working here.
According to the IRS, the following individuals are also subject to the shared responsibility payment:
- Permanent residents
- Foreign nationals who are in the United States long enough during a calendar year to qualify as resident aliens for tax purposes
The IRS states that, even if they must file a U.S. income tax return, foreign nationals who live in the country for a short enough time period that they do not become resident aliens for federal tax purposes are not subject to the penalty for going without health insurance.
To become a resident alien, you must either pass the:
- “Green card test,” which applies if you were a lawful permanent resident at any time throughout the calendar year according to U.S. immigration laws and the status was not “rescinded or administratively or judicially determined to have been abandoned”; or the
- “Substantial presence test,” which means you have been physically present in the U.S. on at least 31 days during the calendar year and 138 days during the three-year period that includes the current year and two years immediately prior.
Days spent commuting to work in the U.S. from Canada or Mexico do not apply, nor do days spent in transit. Individuals exempt from resident alien status include:
- Those temporarily present in the U.S. as a foreign government-related individual
- Teachers or trainees temporarily present in the U.S. with a J or Q visa who substantially comply with the visa’s requirements
- Professional athletes temporarily present to compete in a charitable sports event
Essentially, most lawfully present immigrants must have health insurance coverage unless they qualify for an exemption. Those who do not have an exemption and fail to secure coverage will owe the tax penalty known as the shared responsibility payment.
Read “22 Ways to Legally Get Out of Buying Health Insurance Under Obamacare,” to learn more about exemption eligibility.
Where can immigrants buy health insurance?
Non-citizens are three times more likely to be uninsured than U.S. born residents, according to Kaiser Health News, which cites low wage jobs without health insurance as a reason many of the 21 million non-citizen immigrants (whether here legally or not) here are concerned about health coverage.
So where can they buy health insurance if they do not have access to it through an employer? Lawfully present immigrants may purchase health insurance from the state exchanges, federal marketplace and private marketplace. Those who can enroll in health insurance through the state exchanges and federal marketplace include the following,:
- Qualified non-citizen immigration status without a waiting period (e.g., lawful permanent resident, Green Card holder)
- Humanitarian statuses or circumstances such as Temporary Protected Status, Special Juvenile Status, asylum status, Convention Against Torture, and victims of trafficking
- Valid non-immigrant visas (e.g. worker visas, student visas)
- Legal status conferred by other laws, including temporary resident status, LIFE Act, and Family Unity individuals
Those who buy from state exchanges or the federal marketplace may apply for income-based financial assistance in the form of premium tax credits and cost-sharing subsidies to help lower their monthly premiums and out-of-pocket spending.
Premium tax credits are available to those who make between 100 and 400 percent of the federal poverty level. Cost-sharing subsidies are available to those who make between 100 and 250 percent of the federal poverty level.
Individuals who do not legally live in the United States cannot buy health insurance through the exchanges and do not qualify for financial assistance.
Some lawfully present immigrants may qualify for Medicaid and CHIP coverage. In addition to meeting eligibility requirements based on income and other criteria, lawfully present immigrants must be in the United States for five years or more before they can apply for Medicaid and CHIP. In some states, this waiting period may be removed under circumstances such as pregnancy.
Health insurance plans without a subsidy is also available in the private marketplace through websites such as HealthCare.com. Use our subsidy calculator to see if you might qualify for a premium tax credit; if you do, visit your state exchange or the federal marketplace to shop and enroll in a health insurance plan.
Call 877-275-0485 to speak to a licensed insurance agent from one of our trusted partners.
 Internal Revenue Service. “Questions and Answers on the Individual Shared Responsibility Provision.” Dec. 10, 2014. http://www.irs.gov/Affordable-Care-Act/Individuals-and-Families/Questions-and-Answers-on-the-Individual-Shared-Responsibility-Provision
 Appleby, Julie. “FAQ: Obamacare and Coverage for Immigrants.” Kaiser Health News. Sept. 19, 2013. http://kaiserhealthnews.org/news/health-care-immigrants/.
 HealthCare.gov. “Immigration Status and the Marketplace.” https://www.healthcare.gov/immigrants/immigration-status/.
 HealthCare.gov. “Coverage for Lawfully Present Immigrants.” https://www.healthcare.gov/immigrants/lawfully-present-immigrants/.