Who is exempt from Health Care Reform?

The law provides exemptions for some very specific circumstances.  I get asked this question at almost every seminar I do – ” Is it true that so-and-so is exempt?”

You should be aware that Medicaid, Medicare and TriCare (Military coverage) are all considered to meet the requirements of the law, and therefore no exemption is needed in those cases.  So here are the exemptions:

1)  Religious Conscience- If your organized religion does not believe in accepting private or public insurance, you may be exempt.  Originally put in for the Amish and Old Order Mennonites, but may have wider inclusion.  It is available to any group covered under Treasury Rule 26 CFR 1.5000A-3(a).  There has been a consistent rumor that the Muslim sect would be exempt;  that is untrue.

2)  If no affordable health insurance option is available.  Note that this means affordable under the rules, not what you think is affordable.  You would be exempt if the only available plan exceeds more than 8% of your income.

3)   Membership in a health care sharing ministry.  These programs are recognized in 22 states and have about 160,000 members.  They share expenses between the members of the ministry.

4)  Incarceration, but only after the disposition of charges.

5)  Membership in an Indian Tribe that is federally recognized.

6)  Hardship- for a month or months in which a person has unexpected, significant increases in essential expenses, with natural or human-caused.  This one comes with several pages of rules and documents needed.

7)  Undocumented immigrants are exempt.  But in order to get the exemption, wouldn’t they have to document themselves?

8)  Short Term Coverage Gaps of no more than 3 months are acceptable.

9)  Individuals with income below $9750 – essentially those that are not required to file a tax return.


The law recognizes that you may be eligible for more than one exemption at a time.   There may be some significant changes to these exemptions prior to October 1.