Can You Skip Your Final Health Insurance Premium?

Understanding the Grace Period

The Affordable Care Act (ACA) mandates health insurance plans to provide a one-month grace period for premium payments. During this grace period, individuals are considered enrolled and covered, even if they don’t pay their premium on time.

Scenario: Skipping the Final Premium

Let’s imagine a situation where an individual’s insurer is withdrawing from the marketplace and no longer offers plans for the following year. The insurer provides a one-month grace period that allows the individual to delay their December premium payment until December 31st. However, the individual plans to switch to a new plan with a different provider starting January 1st.

Owing the Premium in Case of Non-Payment

The key question to address is whether the individual will still owe the insurer a premium payment for December if they skip it and don’t need medical care.

According to the provided post and responses, the answer may depend on whether the individual receives advanced premium tax credits (APTC) or not.

Case 1: No APTC

Individuals who do not receive APTC can take advantage of the grace period to skip the final month’s premium without incurring any financial liability. If the individual doesn’t need medical care in December, they can effectively avoid paying the final premium.

Case 2: Receiving APTC

If the individual receives APTC, they may still be responsible for paying the final premium, even if they skip it. This is because APTC payments are sent to insurers monthly, regardless of whether the premium is paid by the individual. If the individual skips the premium and cancels the plan, they may be required to repay the APTC for December.

Furthermore, if the individual chooses to skip the final premium and continue their enrollment into the following year, the insurer may cancel their enrollment for lack of payment, leaving them uninsured and ineligible for a special enrollment period.

Conclusion

Based on the information provided, individuals who do not receive APTC can use the grace period to save money on their final premium. However, those who receive APTC should carefully consider the financial implications before deciding to skip the final payment. If you have any further questions about premium payments or grace periods, it is recommended to contact a licensed health insurance agent for personalized guidance.