Obamacare for the unemployed (health insurance, credit, how much)

[JL]

So my cousin is out of work now. She doesn't qualify for Medicaid in Texas. I was reading that in order to qualify for ACA with government subsidies to have most of your health insurance paid for, you need to earn at least $15k per year. I was wondering if she had at least $15k in her bank account if that qualified. It turns out that it doesn't qualify, but if he opens a checking out with interest it will qualify as income due to having to file tax on that interest income. Has anyone been in this similar situation? If so, any tips or suggestions? Thanks.

[Wartrace]

Originally Posted by JL

So my cousin is out of work now. She doesn't qualify for Medicaid in Texas. I was reading that in order to qualify for ACA with government subsidies to have most of your health insurance paid for, you need to earn at least $15k per year. I was wondering if she had at least $15k in her bank account if that qualified. It turns out that it doesn't qualify, but if he opens a checking out with interest it will qualify as income due to having to file tax on that interest income. Has anyone been in this similar situation? If so, any tips or suggestions? Thanks.

They base your eligibility using the prior year's income. She could probably qualify due to losing health insurance from her previous employer. Have her fill out the ACA paperwork and see what they say.

Interest on 15k is only 750 dollars per year; still Medicaid territory. I assume your cousin will eventually get a job this year; I'm pretty sure she would qualify for ACA coverage.

[SanJac]

Originally Posted by Wartrace

They base your eligibility using the prior year's income. She could probably qualify due to losing health insurance from her previous employer. Have her fill out the ACA paperwork and see what they say.

Interest on 15k is only 750 dollars per year; still Medicaid territory. I assume your cousin will eventually get a job this year; I'm pretty sure she would qualify for ACA coverage.

Actually eligibility is based on your projected income. I’ve never heard of a $15K minimum. I think you got bad information.

[ChristieP]

They do look at your current and projected income, so if you have none, the premiums are pretty cheap. I’ve had several coworkers retire at age 63-64, and use healthcare.gov to buy health insurance until they hit Medicare eligibility. They say they get good plans for under $200 monthly.

[Wartrace]

Originally Posted by SanJac

Actually eligibility is based on your projected income. I’ve never heard of a $15K minimum. I think you got bad information.

I am guessing that is directed at the O.P., right?

Anyways Yes it is projected income but most people base their projected income on their previous year's income.

[Wartrace]

Originally Posted by ChristieP

They do look at your current and projected income, so if you have none, the premiums are pretty cheap. I’ve had several coworkers retire at age 63-64, and use healthcare.gov to buy health insurance until they hit Medicare eligibility. They say they get good plans for under $200 monthly.

My brother-in-law did that. His net worth is over 2 million but managed his income to qualify for free insurance.

[SanJac]

Originally Posted by Wartrace

I am guessing that is directed at the O.P., right?

Anyways Yes it is projected income but most people base their projected income on their previous year's income.

Unless you retire or are laid off. Your entire eligibility (for subsidies) is based on projected income. You have to explain why there might be a large discrepancy between projected income and prior income (e.g., losing your job). If you project incorrectly then you will pay a penalty or receive additional credit when you file your tax return.

It's conceivable you could pay nothing for insurance but trust me the plan will reflect that. It's a matter of perspective depending on what you were used to. Going to an HMO from a PPO is like night and day. You will most likely lose all your existing medical providers.

[texasdiver]

There are two issues with applying for an ACA (Obamacare) policy at the moment. Both may or may not be surmountable.

The first issue is that you are outside the open enrollment window for applying for a subsidized ACA plan. It runs from November 1st to January 15 every year. You can still apply outside the enrollment window, but you must have a triggering life event that makes you eligible. Such as the fact that you moved states, got unemployed or changed jobs, etc. Look these up to make sure that you qualify. A job loss would seem to be one of those criteria.

The second issue is the income thresholds. This is projected income because no on has any way of knowing how much money you will actually make in 2024. You might finish the year with a bang. So figure out what the income threshold is for your particular circumstance and when you apply through the ACA web portal, make SURE that you enter in 2024 projected income ABOVE the threshold. But not too far above or you will reduce your subsidy. If you put in a projected income below the threshold they will deny you coverage.

This will give you insurance up to 2025 and then you get to do the process all over again. If your actual income for 2024 turns out to be much higher than what you projected when you applied for ACA coverage you may owe some back taxes or penalties for the subsidies that you got that you weren't entitled to.

[ChristieP]

Yes, loss of coverage due to unemployment is considered a "life event" that allows a person to enroll outside of the open enrollment window.

I would assume that once the person becomes eligible for employer coverage, they would drop the ACA plan. Although there is a cost with the employer coverage, the risk of having to pay penalties/taxes for the subsidies would definitely outweigh the cost of the employer plan.

[Dopo]

Originally Posted by ChristieP

Yes, loss of coverage due to unemployment is considered a "life event" that allows a person to enroll outside of the open enrollment window.

I would assume that once the person becomes eligible for employer coverage, they would drop the ACA plan. Although there is a cost with the employer coverage, the risk of having to pay penalties/taxes for the subsidies would definitely outweigh the cost of the employer plan.

A person can have a ACA and refuse to take the one provided by their employer
The subsidy will be based on the estimated income and whether or not the calculation was done right, that will come up when doing taxes