How effective actually is the ACA's individual mandate?

In an effort to increase enrollment numbers, the Affordable Care Act mandated that Americans have health insurance that meets minimum standards or face a potential penalty. But a new analysis from the Kaiser Family Foundation reveals that paying the penalty may be less expensive than signing up for an insurance plan for most Americans.

The penalty can be no more than the out-of-pocket cost for the national average premium for a bronze plan, which is $2,484 in 2015 for single coverage and $12,420 for a family of three or more children, the analysis points out. Given that rule, out of almost 11 million uninsured Americans who are eligible to enroll in marketplace coverage with or without premium assistance, 7.1 million of them would actually pay less for any penalty than they would for the least expensive insurance option available to them.

That means the mandate may not create much of an incentive for the uninsured to choose a plan. "The effectiveness of the individual mandate as a tool to increase enrollment will depend on how prominent a place it occupies in outreach messaging," the analysis says. "And, emphasizing the mandate to obtain coverage presents challenges for ACA advocates since it is the most unpopular part of the law."

However, it's estimated that about 7 million uninsured people are eligible for marketplace premium subsidies, which would help to reduce the number of people uninsured and keep premium increases down as more healthy people sign up, KFF states.

The penalty amounts for remaining uninsured have increased substantially since 2014, jumping from $95 per person or 1 percent of household income to $695 per person or 2.5 percent of household income. And unlike previous years, the government is not going to offer a special tax season enrollment period in 2016, as FierceHealthPayer reported.

To learn more:
- read the Kaiser Family Foundation analysis