WIth less than a week to go before Americans can start signing up for and buying health insurance through exchanges provided by the controversial Affordable Care Act (ACA), many are seeking to understand the penalties that will be levied on those who opt to go without insurance.

The enrollment period opens up October 1 and continues through the end of March for 2014 coverage. Despite the fact that open enrollment continues through March, however, people who haven’t signed up by December 15 risk incurring a penalty.

US Health and Human Services Secretary Kathleen Sebelius has said that ” … these new options will finally make health insurance work” with the budgets of millions of Americans who have previously been unable to afford health insurance premiums.

But what about those who decide that even with the income-based subsidies provided by the ACA, they just can’t spare the extra money for premiums?

The ACA requires nearly everyone to either buy health insurance or pay a penalty. This provision has came to be known as the “individual mandate.”

It’s one of the more controversial aspects of the ACA. It was challenged in the Supreme Court last year as unconstitutional, but the court upheld it on the basis that the individual mandate is essentially a tax, which as we all know is a right afforded our government under the Constitution.

So, if you opt to incur the penalty instead of buying insurance, how much will you pay?

You’ll get a bit of a break the first year. For 2014, you’ll pay $95 per uninsured adult* in the household (capped at $285 per household) or 1% of the household income over the filing threshold, whichever results in a larger fee. For now, the filing threshold is $10,000 for an individual and $20,000 for a family.

In 2015, that changes to $325 per uninsured adult* (capped at $975) or 2% of the household income over the filing threshold.

By 2016, the amounts will be upped to $695 per uninsured adult* (capped at $2,085 per household) or 2.5% of household income over the filing threshold.

*The penalty is half the amount for those under age 18.

Taking the penalty will be the less expensive option for many such as these CNNMoney readers.

But some worry that the ACA has set the fine too low, making it too attractive an option for the young and healthy, who don’t necessarily need insurance to the extent that the elderly and infirm do. They speculate that this lack of healthy participants in the healthcare exchanges will throw the entire system off balance.

Image via Wikimedia Commons.