What is “Minimum Essential Coverage” (MEC) And What Does It Mean To Me?

What is “Minimum Essential Coverage” (MEC) And What Does It Mean To Me?

Bottom line, it lets you know if the plan you are considering is measured as a qualified plan under the Affordable Care Act law. If it is, it will keep you from paying the Individual Mandate Tax Penalty regarding health insurance. But if it is not MEC, it will not protect you from the penalty cost.

For those of you that like more detail: Minimum Essential Coverage is the standard by which the Affordable Care Act classifies major medical health plans. The plan is not considered “qualified” coverage if it does not contain the 10 Essential Health Benefits and has an actuarial value of at least 60%, meaning the plan will pay at least 60% of the participants health care expenses.

If you do not have a “qualified” Minimum Essential Coverage health plan, you will likely be required to pay the Individual Mandate Penalty at tax time. That applies to most people if they go more than 2 months without coverage, unless they qualify for a Hardship Exemption.

Penalty vs the cost of the Insurance:

For many people, it comes down to the cost. With rising health insurance cost and less choice in plans, I suspect more people than ever will be looking for other options to protect themselves from a catastrophic health event. People will be weighing the difference in the cost of the insurance verses the penalty they might pay. But there is danger in purchasing a plan you do not fully understand. We can help you understand! Give us a call today.

Curious about what your penalty is likely to be if you forgo Qualified coverage? Use this estimator to get an idea, based on your household income.


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