7 On Your Side: Tax penalties coming for those with no health insurance

SAN FRANCISCO (KGO) -- A huge number of people face hundreds, if not thousands of dollars, in tax penalties, if they don't get health coverage by the end of the month. 7 On Your Side looks into how you can avoid the penalty.

San Francisco resident Olga Ten is like many people in their 20's. She lives on a starting salary and she hasn't had health insurance since graduating from San Francisco State University.

"I think one of the reasons most people don't buy health insurance is they don't see it as a major priority," Ten said.

It only became a priority after she got sick and had to see a specialist. The deadline to get health insurance was two months ago, but Covered California extended it until April 30 for people like Ten.

"People wanted to take chances and then when they were faced with penalty, that's when they realized this is not a game," Diana Polyakov from the Insurance Center Helpline said.

Polyakov is a certified insurance agent with Covered California. She met with Ten to discuss her options. Ten is in the United States on a work visa from Russia and just learned about the mandatory health insurance requirement.

"I don't really like it, but the options they offer are more affordable plans compared to others, that part I like," Ten said.

The penalty is one percent of your after-tax income or $95 per adult--whichever is higher. For someone who earns $40,000 before taxes, the penalty would be $299. That nearly doubles to $497 in the 2015 tax year. Ten learned her penalty would be about $300.

"I feel relieved the application deadline was extended," she said.

It's estimated about one million people eligible for Covered California have not yet enrolled in any insurance plan. The state wants to give them every opportunity to do so.

Lizelda Lopez from Covered California told 7 On Your Side, "We know, for example, 90 percent of our consumers receive assistance to pay for that coverage."

"Some people would pay much less in monthly premiums for health insurance than the penalty," Polyakov said.

Ten is one of only about 22,000 people statewide to enroll in Covered California since the deadline, but a huge surge in enrollment is expected in the coming days.

"I think it's a good idea to have health care coverage. It gives you some peace of mind," Ten said.

Click here to find enrollment counselor or certified insurance agent

Apply online for health insurance through Covered California here

Phone number for enrollment help: 1-800-300-1506
Copyright © 2021 KGO-TV. All Rights Reserved.