Thursday, September 11, 2014

Want to Save 25% on Obamacare Insurance?

A couple of small known facts about Obamacare could provide a savvy (though not necessarily smart) purchaser of health insurance with a way to save 25% on their annual premiums.

1. The grace period for not paying premiums until an insurer cancels an insured is 90 days (on exchange).
2. The amount of time one can be uninsured before they are subject to the individual mandate tax is 90 days.

Couple these two items above along with open enrollment that includes no pre-existing conditions, guaranteed issue, and community rating and consumers can take advantage of the following loophole.

Let's say I purchased my Obamacare plan last year and paid my premiums on time from January through November. I just got my invoice for December but have decided that I'm going to roll the dice for the short term. December and January pass and I have yet to pay either premium. It's now February 28th - my 90th day without paying for insurance. I've had zero claims and went into between February 1st and February 15th and enrolled in the exact same plan I had last year for 2015. The new plan takes effect on March 1st.

No premiums. No penalty. Perfect cancellation date. Obamacare!
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