Obamacare Questions

How and when should I report an income change to the Marketplace?

Any significant changes to your household income should be reported to the Marketplace as soon as they occur.  If you are eligible for a tax credit, the income change will most likely affect the amount of assistance you receive and a new eligibility letter will be issued to you.

A rule of thumb is:  if your income increases, your tax credit will decrease.  If your income decreases, your tax credit should increase.  If your income reaches 400% of the poverty level, you will no longer be eligible to receive a tax credit.

If your income drops to 138% of the poverty level, you may qualify for free or very low cost coverage.

What if I need to cancel my Marketplace plan?

If you become eligible for coverage outside of the Health Insurance Marketplace, you may want to cancel your Marketplace plan.  Obtaining job-based coverage or becoming eligible for a program like Medicare, Medicaid or the Children’s Health Insurance Program, would be reason to cancel your Marketplace coverage.

To cancel your plan for everyone on your application or just certain people, follow this link https://www.healthcare.gov/reporting-changes/cancel-plan/#howto.  Cancellation will go into effect within 14 days.  You will be unable to re-enroll in Marketplace coverage until the next Open Enrollment Period unless you have a special enrollment situation.

What if I need health coverage, but Open Enrollment has ended?

There are certain life events that may qualify you for a special enrollment period.  If you are getting married, having a baby, adopting a child or placing a child up for adoption or foster care, losing other health coverage, moving to a different coverage area, being released from incarceration or experiencing a change in citizenship, you may be granted a 60 day window to enroll in a Marketplace plan.

If, however, you did not enroll for health coverage during the 2015 Open Enrollment and do not qualify for a special enrollment period, you must wait until the 2016 Open Enrollment begins on November 1, 2015 to apply. IF you qualify, coverage will start January 1, 2016.  The 2016 Open Enrollment season ends on January 31. 2016.

If you believe you qualify for a special enrollment period you can apply online here or or call 1-800-328-6698.

What if I missed 2015 Open Enrollment and do not qualify for a Special Enrollment period?

Open enrollment for the 2016 marketplace plans begins on November 1, 2015 and ends January 31, 2016. If you qualify, coverage begins January 1, 2016.

If you do not enroll in a 2016 plan by January 31, 2016, you can’t enroll in a health insurance plan for 2016 unless you qualify for a special enrollment period.

If I buy my insurance direct from the company instead of using the marketplace can I purchase insurance at any time?

The insurance that you are able to purchase year-round direct from the companies and without any “special election periods” does not meet the essential health benefits requirements. Meaning that you can purchase insurance during the lock-in period by going direct to the plans but the insurance you are purchasing does not cover all of the legally required benefits and you will still be fined at the end of the year when filing your taxes.

The types of plans available to purchase this way are critical illness, hospital indemnity and short term medical to name a few. In order to purchase a plan that does cover all of the essential health benefits and avoid being fined you will need to purchase a plan during open-enrollment or if you have a qualifying life event you can purchase a plan during the lock-in period. Whether you purchase your plan direct with the company or through the marketplace has no effect on the rules for enrollment deadlines.

What are “Catastrophic Plans”?

Catastrophic plans are plans that are available for a lower monthly price. These plans have a higher deductible and you will need to pay the full amount of the deductible, $6,600 for an individual, before the insurance company begins contributing to your medical costs.

These plans are automatically available to adults up to the age of thirty and for adults over the age of thirty can be made available only if no other marketplace policy exists that will cost them for less than 8% of their income.

If you live in two different states during the year, in which state do you purchase your insurance from and can you be treated in both states?

You must purchase insurance in the state you officially live in, usually this is the state where you are registered to vote, pay taxes, and register your vehicles.

Plans will offer emergency care in both states but if you are looking for more routine treatment and care you will need to look for a plan with a national provider network to locate in-network providers in both areas you reside in.

What do I include as income when applying for coverage in the marketplace?

 

You will need to include any earned income that is reported on your W-2. You are also required to report any tips you may receive, unemployment benefits received, alimony, and social security payments. Any withdrawls from an IRA or 401k will also need to be included as well as retirement and pension income.

If you have any investment income that will need to be reported as well as winnings from awards or gambling. If you are self-employed you will report your net income not your gross income. Remember that your net income is the profit left over after all of the business expenses have been paid.

It is also important to know what not to report as well. While you are reporting alimony received you do not report child support received. You will report social security payments but not supplemental security income. Veteran’s disability payments are not reported neither are loans you received. See the IRS Publication 525 form for more information about what to report and what not to report in regards to income.

I am offered health insurance through my employer, but to add my spouse and children makes the cost unaffordable.  Can we shop around for a more economical plan on the Marketplace?

 

You are free to purchase a Marketplace plan; however, your family members will not qualify for a tax credit to help pay the premium unless the cost of your job-based coverage is considered “unaffordable”.

When people are eligible for employer-sponsored coverage, they can only qualify for Marketplace premium tax credits if the job-based coverage is considered unaffordable by following this calculation:  the cost for coverage for yourself, only, under the employer plan, must be more than 9.56% of your family income. The additional cost of adding coverage for your family members is not taken into consideration.

So although you may feel your family coverage is unaffordable, so long as “your cost only” is under 9.56%, it is considered technically affordable.  Your family members may purchase Marketplace coverage, but will not receive a tax credit.

New question?

New Answer If you become eligible for coverage outside of the Health Insurance Marketplace, you may want to cancel your Marketplace plan.  Obtaining job-based coverage or becoming eligible for a program like Medicare, Medicaid or the Children’s Health Insurance Program, would be reason to cancel your Marketplace coverage.

To cancel your plan for everyone on your application or just certain people, follow this link https://www.healthcare.gov/reporting-changes/cancel-plan/#howto.  Cancellation will go into effect within 14 days.  You will be unable to re-enroll in Marketplace coverage until the next Open Enrollment Period unless you have a special enrollment situation.