International Students, Exchange Visitors and the PPACA: Who is Eligible?

The Patient Protection and Affordable Care Act (PPACA) runs to thousands of pages long and contains considerable detail about healthcare provision, availability, and cost, so it is not surprising that many people have questions about their eligibility under the Act. The US government has attempted to clarify all relevant aspects of the Act but doubts still remain. It is particularly true in the case of foreign-born persons living in the United States on a temporary basis, for example, international students and exchange visitors. If you are studying at a US university and you were born overseas, are you eligible under the PPACA – must you have health insurance, and can you buy it through the subsidized health insurance marketplace? How about if you are an au pair or a visitor on an exchange scheme living in the United States for one semester? Do you need to buy health insurance under the PPACA? How does the mandate of the Patient Protection and Affordable Care Act apply to international students and exchange visitors? Here we explain, with the help of this infographic, what it means if you are a student or visitor looking for healthcare insurance in the US.

Eligibility: A Simple Answer?

The Congressional Research Service, using the Current Population Survey, estimates that as of March 2010 there were nearly 37.6 million foreign-born people living in the United States, and out of these 21.6 million were non-citizens including those on F visas and J visas. If you are staying in America on a short-term or long-term temporary basis it can be difficult to understand where and when the regulations for US citizens apply to you as a non-citizen. Fortunately, there is one clear answer when it comes to eligibility for the PPACA and the requirement under the mandate to have health insurance: the mandate doesn’t apply to international students on F, J, M and Q visas for the first five years they are in the US. Non-students on J visas – trainees, work and travel visitors, au pairs, camp counselors, interns, teachers etc. – are not eligible for the PPACA or required to have health insurance under the PPACA for the first two years they are in the States. Here’s a little more detail regarding the Patient Protection and Affordable Care Act mandate for exchange visitors and international students.

What is the PPACA Mandate?

The requirement to have qualifying health insurance –also called minimum essential coverage – is built into the PPACA. Everyone must have health insurance or pay a penalty. This mandate is vitally important to the functioning of the scheme – in order to be able to provide affordable coverage to people that were previously without health insurance, everyone (even those that have no pre-existing health condition) needs to buy insurance so that the cost of the program is covered. But the mandate is not particularly fair or convenient for everyone, for example, international students would find the PPACA healthcare plans to be more expensive and less applicable to their needs than specialist international student medical insurance plans.

Alien Tax Status and Eligibility

As the penalty for not having PPACA-regulated insurance is a tax, the enforcement of the regulations falls to the IRS. The IRS states that “foreign nationals who are in the United States long enough during a calendar year to qualify as resident aliens for tax purposes” are eligible for PPACA health insurance and required to have it. How do you know if you are a resident alien for tax purposes? Green card holders are resident aliens. You are generally a resident alien if you spend half of a year in the States – unless you are exempt.  International students “temporarily in the United States on an “F”, “J”, “M”, or “Q” visa for the primary purpose of studying at an academic institution or vocational school, and who substantially complies with the requirements of that visa,” are exempt, says the IRS. This exemption lasts for five years and after these five years are up, the student may or may not continue to qualify as a non-resident alien based on the “closer connection” regulation.

Are you Eligible?

So, in summary:

• All US citizens, green card holders and those people classed as resident aliens must have PPACA health insurance
• If you are a student on an F visa and you have been in the US for less than five years, you are not eligible
• If you are a non-student on a J visa and you have been in the US  for less than two years, you are not eligible
• After five years and two years, F visa holders and J visa holders respectively must satisfy the substantial presence test (see the infographic for details) in order to be eligible or continue to be ineligible

As international students and exchange visitors are not eligible for PPACA insurance during their first years in the United States they are free to buy health insurance that is expressly targeted towards their needs and don’t have to worry about whether the plans meet PPACA requirements.