Children’s Coverage in 2014

To help reduce the ranks of the uninsured, the Affordable Care Act creates new health insurance marketplaces (also referred to as health insurance exchanges) and expands Medicaid. States that choose not to expand their Medicaid program for the adult population will still need to extend Medicaid coverage to all children with incomes up to 133 percent of the federal poverty level (FPL).1 The ACA’s individual shared responsibility provision (or the individual mandate) requires that all individuals, including children, obtain “minimal essential coverage” beginning January 1, 2014. Children and youth who receive coverage through a government sponsored program, such as Medicaid or CHIP, or through an employer-sponsored plan, the individual market, or a marketplace plan will meet this requirement. The ACA requires parents to enroll any eligible dependent child in minimum essential coverage before enrolling themselves in Medicaid.

Individuals can be exempt from the mandate if they are members of certain religious groups or Native American tribes, are undocumented, incarcerated, do not file taxes due to low income, qualify for a hardship exemption, or are unable to afford coverage as defined by the law. If self-only employer-sponsored coverage is deemed affordable but family coverage is not, spouses and children are exempt from the individual mandate. Those who do not qualify for an exemption and choose not to be insured will be subject to a penalty.

1The new Medicaid eligibility floor is 133 percent FPL plus a standard five percent disregard, effectively making the new Medicaid eligibility level 138 percent FPL.