Commentary

Obamacare and Its Exemptions: How to Get Out of Paying the Penalty

By Twila Brase | November 23, 2016 | 10:43am EST
Protester holds signs denoting his dissatisfaction with Obama's failed healthcare law the ACA that read: "We will not comply" and "It's Not Working." (AP Photo)

Now through Jan. 31, uninsured Americans will be weighing their not-so-attractive options when it comes to health care coverage. For many, that will be a choice between an unaffordable premium or going without coverage and paying a penalty.

But Citizens’ Council for Health Freedom (CCHF, www.cchfreedom.org) is educating Americans about the Obamacare exemptions and waivers they can claim to avoid paying the penalty tax.

HealthCare.Gov does list exemptions and waivers that Americans can claim, but they are not widely known. Therefore, many could avoid paying the penalty of $695 or 2.5 percent of their adjusted gross income for going without coverage.

Those committed to a last-ditch effort to save Obama’s failing legacy are working hard to pump final enrollment numbers before the possibility of repeal becomes a reality. But, even before then, there are many ways patients can protect themselves from Obamacare and its tax penalties.

The first step is to refuse to enroll altogether and claim one of the nine exemptions or 14 hardship waivers. There are also several other ways Americans can avoid these penalties without being bullied into enrolling in Obamacare.

CCHF lists the nine exemptions on its website, which include:

  1. Religious conscience exemption
  2. Health care sharing ministry
  3. Individuals not lawfully present
  4. Incarcerated individuals
  5. Individuals who cannot afford coverage (in general, if coverage for the month exceeds 8 percent of the individual’s household income)
  6. Taxpayers with income below filing threshold
  7. Members of Indian tribes
  8. Months during short coverage gaps (the penalty will be pro-rated after 2 consecutive months without coverage)
  9. Hardships

The hardship waivers open 14 doors to avoiding the penalty. Some of these include:

  • You were homeless, faced eviction or foreclosure, received a shut-off notice from a utility company, experienced domestic violence, or experienced the death of a family member, fire, flood or other natural or human-caused disaster that caused substantial damage to your property.
  • You filed for bankruptcy or had medical expenses you couldn’t pay that resulted in substantial debt.
  • You experienced unexpected increases in necessary expenses due to caring for an ill, disabled, or aging family member.
  • Your individual insurance plan was cancelled after June 30, 2013, and you believe other exchange plans are unaffordable.
  • You experienced a hardship that kept you from getting health insurance that’s NOT listed in categories 1-13.

Most Americans who are truly facing the financial burden of Obamacare will be able to find an exemption or waiver in one of these two lists that will prevent them from paying the penalty. Many incorrectly feel that they are faced with two limiting choices: paying high premiums or paying the penalty for no coverage at all. There are options outside of these, and CCHF urges everyone to better understand what their real options are for health care.

For more than five years since the signing of the Affordable Care Act, CCHF has provided several alternatives to the failing Obamacare system, and continues to do so now during open enrollment.

  1. Join a health sharing ministry. One of the Obamacare exemptions, health sharing ministries, brings members together to share each other’s medical expenses. Monthly costs for some of the most popular, such as Samaritan Ministries, Medi-Share and Liberty Health Share, range from less than $200 for a single individual to around $500 for a family.
  1. Find a cash-based practice. Many insured Americans will never reach their deductibles, and more physicians are operating practices free from the high costs of government regulations and managed care controls. These third-party-free practices often offer high-touch, timely, confidential, patient-centered care at affordable prices. To find cash-based practices, check out CCHF’s The Wedge of Health Freedom at www.JointheWedge.com. The Wedge adds practices each week and now covers about 40 states.
  1. Enroll in private insurance outside of the government exchanges, in particular, a self-funded employer’s plan, which may be exempt from some of the law’s requirements and less costly. Also, consider separate critical care, cancer or accident indemnity policies.

Twila Brase is president and co-founder of Citizens’ Council for Health Freedom (CCHF, www.cchfreedom.org), a Minnesota-based national organization dedicated to preserving patient-centered health care and protecting patient and privacy rights. Celebrating its 20th year, CCHF exists to protect health care choices and patient privacy. Brase, a registered nurse, has been called one of the “100 Most Powerful People in Health Care” and one of “Minnesota’s 100 Most Influential Health Care Leaders.”

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