You can free-ride uninsured for two months each year with little risk and no penalty.
There’s no individual mandate penalty for being uninsured if it’s for less than two months. So cancel it every year for two months, and save two months’ premiums each year.
Section 1501 of the UnAffordable Abomination Act says you owe the penalty for every month you are uninsured, except
“Any month the last day of which occurred during a period
in which the applicable individual was not covered by
minimum essential coverage for a continuous period of
less than 3 months.” 1501 (e)(4)(A)
Translating the legal mumbo-jumbo into plain English, your helpful government wants you to know:
“You don’t have to pay the fee for any month you’re covered by a plan that qualifies as minimum essential coverage. If you’re uncovered only 1 or 2 months, you don’t have to pay the fee for any month.”
So, there’s no penalty for a single lapse of two months.
Here’s how one woman does it:
“On October 30, two days before 2016 open enrollment, she called her health insurer and canceled her coverage for the rest of 2015. She reasoned the $778 she will save by dropping coverage for two months would be well worth the risk. Her coverage gap would only last two months, so she will not have to pay a penalty. In a few days she could sign up again for coverage to begin January 1.”
So take a vacation from Obamacare, and don’t forget to send us a postcard.