Obamacare 2015: Higher costs, higher penalties

With the Affordable Care Act to start enrollment for its second year on Nov. 15, some unpleasant surprises may be in store for some.

That's because a number of low-priced Obamacare plans will raise their rates in 2015, making those options less affordable. On top of that, penalties for failing to secure a health-insurance plan will rise steeply next year, which could take a big bite out of some families' pocketbooks.

"The penalty is meant to incentivize people to get coverage," said senior analyst Laura Adams of InsuranceQuotes.com. "This year, I think a lot of people are going to be in for a shock."

In 2014, Obamacare's first year, individuals are facing a penalty of $95 per person, or 1 percent of their income, depending on which is higher. If an American failed to get coverage this year, that penalty will be taken out of their tax refund in early 2015, Adams noted.

While that might be painful to some uninsured Americans who are counting on their tax refunds in early 2015, the penalty for going uninsured next year is even harsher. The financial penalty for skipping out on health coverage will more than triple to $325 per person in 2015, or 2 percent of income, depending on whichever is higher. Children will be fined at half the adult rate, or $162.50 for those under 18 years old.

Based on the flat-rate method, the maximum dollar amount an uninsured family could be fined is $975.

That flat-rate penalty "will affect lower-income or middle-income households," Adams said. Some middle-class families "may be making enough that they don't qualify for a subsidy, so they won't get a break if they are getting health coverage. It's a big penalty for the middle class for not having insurance."

Considering that Americans' average tax refund is about $3,000, that 2015 penalty could take a big chunk out of some payouts.

In Obamacare's first year, some Americans may have opted to pay the penalty rather than get insurance because it may have cost more to take out health coverage, Adams added. But with the penalty rising next year, it may spur more consumers to consider getting a plan, as well as create more grumbling.

There are some loopholes for getting out of the penalty, however. People can claim financial hardship or forgo health insurance for fewer than three months, according to HealthCare.gov. Native Americans also are exempt from paying a penalty as long as they are members of a federal recognized tribe.

Despite the government's push to get Americans enrolled in health-care plans, a significant number remain uninsured. About 13.4 percent of U.S. adults lacked health insurance in April, according to a Gallup poll. For lower-income households earning less than $36,000, the rate was much higher, with one out of four lacking insurance.

Still, that represents a decline from 2013, when 17.1 percent of adults across the nation lacked insurance, and almost 31 percent of households going uninsured.

It's not only the uninsured who will be facing higher costs. Many health-care plans are also charging more, with Investor's Business Daily finding that a 27-year-old earning 250 percent of the poverty rate will pay an average of 7 percent more for the lowest-cost bronze plan, based on an analysis of rates in the largest city in 34 states. The lowest-cost silver plan will rise an average of 9 percent, while the lowest-priced catastrophic policy will climb 18 percent, the analysis found.

Between 9 to 9.9 million Americans will enroll in heath coverage through the Obamacare marketplaces for 2015 coverage, the Health and Human Services Department said on Monday. That's lower than the 13 million people that the nonpartisan Congressional Budget Office had earlier this year estimated would enroll for 2015.

Aside from higher penalties and potentially higher health-care costs, Obamacare may be facing another challenge in luring consumers: awareness.

Nine out of 10 uninsured Americans are unaware that open enrollment starts on Saturday, according to a recent poll from the Henry J. Kaiser Family Foundation. On top of that, two-thirds of uninsured Americans say they know either nothing or just a little bit about the marketplaces.

Americans still aren't crazy about the law, the poll found. Only 20 percent of Americans have favorable views of Obamacare, while 43 percent held unfavorable opinions, the study found.

Many U.S. consumers are also in the dark about the penalties, Adams noted. "There is very little awareness of this," she added. "Until people understand the financial consequences, they don't have an incentive."