FAMILIESUSA.ORG

Health Insurance Down Payments Would Cover Thousands
of Uninsured Marylanders
By Stan Dorn

While the federal government attempts to repeal coverage gains achieved through the Affordable
Care Act (ACA), Maryland is leading the way on innovative solutions to help more people obtain
quality, affordable health insurance. Although Congress has ended federal enforcement of the
ACA’s individual mandate, Maryland lawmakers propose to reverse this sabotage, transforming the
expiring individual mandate into insurance down payments that help the uninsured get coverage,
while lowering costs for people who buy their own insurance today.
This proposal helps Marylanders, both with and
without insurance. Thanks to the ACA, the proportion
of Marylanders without health coverage fell from 11.3
percent in 2010 to 6.6 percent in 2015. Far too many
Marylanders remain uninsured, however, including
more than 200,000 people who qualify for Maryland
Health Connection (MHC) coverage. Many are eligible
for federal financial assistance because their jobs do
not provide health benefits and they earn too little
to afford insurance on their own. They include real
estate agents, farmers, carpenters, child care workers,
sales men and women, and other hard-working
Marylanders. This proposal helps them combine
insurance down payments and federal financial
assistance to sign up for coverage, often available
at no additional cost. Many of the uninsured who
enroll will be young and healthy adults who improve
the risk pool, helping stabilize the market and lower
premiums.

Here’s how it works:
1.  When they file state tax returns starting in 2020,
uninsured Marylanders will receive notice that,
unless they would rather pay a penalty and get
nothing back, their money will be used as a down
payment to help them buy health insurance.

January 8, 2018

2.  For many uninsured consumers, MHC already offers
health insurance that costs no more than the down
payment plus federal tax credits for which the
consumers qualify. If MHC finds that a consumer
can enroll in such a plan at zero additional cost, the
consumer is enrolled.
3.  If MHC cannot find a zero-cost plan, the consumer’s
payment is held in an interest-bearing, “escrow”
account to buy insurance during the next open
enrollment period. When that period starts, MHC
reaches out to the consumer and explains the
health insurance options that the down payment
could help purchase.
4.  If the consumer does not select a plan by the end
of open enrollment, MHC checks to see whether
a zero-cost plan has become available. If so, the
consumer is enrolled in that plan by default.
5.  The consumer can use the down payment only
through the end of open enrollment. After that, a
“use it or lose it” rule applies, and unused down
payments go into a health insurance stabilization
fund.
6.  Medicaid will cover uninsured Marylanders whose
tax returns demonstrate Medicaid eligibility.