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I'm a US citizen and according to the government's dol.gov website am subject to the regulation of the Patient Protection and Affordable Care Act (PPACA, aka ACA or "Obamacare"). This means I must have compliant health insurance, lest I encounter federal sanctions. Because I live outside the country, domestic plans are useless for me, but I cannot find an expat plan that offers PPACA-compliant insurance.

Does anyone have any insight on a solution? Some options include finding PPACA-compliant insurance, simply paying the sanction, or perhaps knowing of an exception that allows expats off the hook.

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  • Not entirely useless — some serious conditions may compel you to move home due to circumstances. But good question.
    – gerrit
    Commented Mar 12, 2014 at 20:55
  • Acknowledged. Because my expat plan covers short trips back to the US, domestic plans really do nothing for me. But I understand that may not be the case for others.
    – einnocent
    Commented Mar 13, 2014 at 1:07

2 Answers 2

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This is described on the IRS site on individual and shared responsibility question 12.

Are US citizens living abroad subject to the individual shared responsibility provision?

Yes. However, U.S. citizens who are not physically present in the United States for at least 330 full days within a 12-month period are treated as having minimum essential coverage for that 12-month period. In addition, U.S. citizens who are bona fide residents of a foreign country (or countries) for an entire taxable year are treated as having minimum essential coverage for that year. In general, these are individuals who qualify for a foreign earned income exclusion under section 911 of the Internal Revenue Code. Individuals may qualify for this rule even if they cannot use the exclusion for all of their foreign earned income because, for example, they are employees of the United States. Individuals that qualify for this rule need take no further action to comply with the individual shared responsibility provision during the months when they qualify. See Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad, for further information on the foreign earned income exclusion.

U.S. citizens who meet neither the physical presence nor residency requirements will need to maintain minimum essential coverage, qualify for an exemption or make a shared responsibility payment for each month of the year. For this purpose, minimum essential coverage includes a group health plan provided by an overseas employer. One exemption that may be particularly relevant to U.S. citizens living abroad for a small part of a year is the exemption for a short coverage gap. This exemption provides that no shared responsibility payment will be due for a once-per-year gap in coverage that lasts less than three months.

So if you are a US citizen and not present in the US for more than one month in a twelve month period you are exempt from having to buy the coverage.

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  • I just read this online too. My question is: is this in the last year, or a longer period? I have lived abroad for 5 years, but e.g. two years ago I came home and worked for just over a month. I didn't spend more than a month in the US this year, am I excluded? If I am excluded, do I have to tell anyone that in any official capacity?
    – la femme cosmique
    Commented Jan 30, 2016 at 12:18
  • You should post it as a separate question.
    – Karlson
    Commented Jan 30, 2016 at 14:05
  • OK I'll do that. I was afraid of spamming or repeating. Thanks!
    – la femme cosmique
    Commented Jan 30, 2016 at 15:36
  • If the community feels it is a repeat we will let you know. Spam is when you rant or just post shameless self promotions.
    – Karlson
    Commented Jan 30, 2016 at 17:41
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Supplemental to Karlson's excellent answer, I want to add a few points about where the PPACA can pose problems for expats. While it is true that you do not need to worry about the individual mandate while living abroad (according to the rules in his answer), there are particularly nasty implications of this mandate for expats anyway and being aware of these is the first step to avoiding problems.

If you are an expat married to a non-US citizen, then when you return to the US, the individual mandate requirements apply to you and to your spouse (and children if applicable), but non-citizens are not eligible for Medicaid for the first five years of residency, and so while subsidies are available down to the poverty line (but not below, meaning if you are under the poverty line you get no subsidies), if you find yourself unemployed during that 5 year period, it could be painful financially and you will need to prepare for extra paperwork/justifications to the IRS for a financial hardship exception. This is particularly problematic of course if you are or intend to be self-employed during that five year period because the normal assurances of the PPACA do not fully apply to you.

My recommendation is that if you are at some point preparing to move back to the US with a family with non-citizen members, that you do not expect to be self-employed initially (if that is a goal), and that you find out exactly what the IRS wants to show a financial hardship in your case (these rules are of course subject to change as the authority to make financial hardship rules was delegated to the IRS).

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  • this answer is not true please remove it @christravers. if you are below 100% of the poverty line and if you are also a recent, documented immigrant, then you are eligible for subsidies on the private exchanges. source: bullet point six of healthcare.gov/what-do-immigrant-families-need-to-know
    – Anthony Damico
    Commented Jun 10, 2014 at 23:16
  • @AnthonyDamico - Instead of asking answer to be removed, better way would be to add details (with links and quotes) how it is wrong and what is better info.
    – Peter M. - stands for Monica
    Commented Mar 7, 2015 at 0:11
  • @PeterMasiar uh huh well they changed the page i linked to sometime in the past six months. now the page that clearly states why this answer is wrong is healthcare.gov/immigrants/lawfully-present-immigrants here's your quote If your annual household income is below 100% federal poverty level: If you’re not otherwise eligible for Medicaid you’ll be eligible for premium tax credits and other savings on Marketplace insurance, if you meet all other eligibility requirements.
    – Anthony Damico
    Commented Mar 7, 2015 at 15:23

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