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Saturday, September 6, 2014

Health Care Insurance Subsidies - Affordable Health Care Act

Like many Americans who were told that "If you like your health care coverage you can keep it" I thought I wouldn't have any problems, but apparently my plan didn't cover everything required by the Affordable Health Care Act and it was cancelled. I liked it - Obamacare didn't!

Apparently, all plans have to cover maternity and newborn care. Even if you are over 60 or a male, you still have to purchase a plan that covers maternity and newborn care!!!!!!!

So here's where the problems start if you lose your individual insurance.
You have 60 days to find new insurance otherwise you will have to wait until open enrollment which begins on November 15 for coverage beginning January 1, 2015. Aetna, whom I had insurance with and cancelled it without any notification, said they would be happy to offer me another plan at twice the amount of my previous one without loss of coverage. (They stated they sent out letters in April which I didn't receive.) Also, for coverage by the 1st of the month, you have to enroll in a plan by the 15th of the previous month or wait an additional month for coverage. i.e. If you apply by September 15, your coverage will start October 1. If you apply after September 16 your coverage will start November 1.

There are subsidies, but those are complicated too. You can read more about those here and there's a handy calculator on the Kaiser site where you can put in your income and personal information to see if you qualify. Subsidies for an individual are available for incomes between $11,490 and $45,960. Ironically, in some states, if your income is below that amount and below the poverty level you won't get any help. The Affordable Health Care was set up to encourage states to widen the requirements to qualify for Medicaid (Texas is one of the states that chose not to.) If for instance your annual income is $10,000 and below the poverty level you will have to pay the full amount of insurance unless you qualify for Medicaid in other ways (with a dependent). You can apply directly for Medicaid on the Healthcare.gov site.

To find out what is considered income you can view Questions and Answers here

On the Healthcare.Gov site you can also ask to view plans for your state and see what you will have to pay before and after subsidies if you qualify. Subsidies aren't available if you don't go through the Marketplace but don't let that discourage you from finding an insurance agent. They can offer advice, walk you through the process and answer any questions you might have. When you sign up through the Marketplace (Healthcare.gov) enter the agent's NPN (number) to show you have an agent working on your behalf.

Beware - If your income changes it could affect your taxes next year  if you have under-estimated or over-estimated your income and received higher subsidies than you are entitled to. Read an article about subsidies and the IRS here

Subsidies are actually Advance Premium Tax Credits and a way to get tax credits before you file your taxes.

And to add insult to injury, if your insurance company chooses to cancel your plan, and you can't find affordable coverage, you will have to pay a penalty for that privilege!

More useful information here with a chart showing poverty levels.

If you have any information that you can add to help others, please let us know in the comments section.

Below info. from IRS.gov site

Health Insurance Premium Tax Credit

Starting in 2014, individuals and families can take a new premium tax credit to help them afford health insurance coverage purchased through an Affordable Insurance Exchange (also known as aHealth Insurance Marketplace). The premium tax credit is refundable so taxpayers who have little or no income tax liability can still benefit. The credit also can be paid in advance to a taxpayer’s insurance company to help cover the cost of premiums. On May 18, 2012, the Department of the Treasury and the IRS issued final regulations, which provide guidance for individuals who enroll in qualified health plans through Marketplaces and claim the premium tax credit, and for Marketplaces that make qualified health plans available to individuals and employers. On Jan. 30, 2013, the Department of the Treasury and IRS released final regulations on the premium tax credit affordability test for related individuals. On April 30, 2013, the Department of the Treasury and the IRS issuedproposed regulations relating to minimum value of eligible employer-sponsored plans and other rules regarding the premium tax credit. Additionally, Notice 2013-41, issued on June 26, 2013, provides information for determining whether or when individuals are considered eligible for coverage under certain Medicaid, Medicare, CHIP, TRICARE, student health or state high-risk pool programs. This determination will affect whether the individual is eligible for the premium tax credit. On May 2, 2014, the Department of the Treasury and the IRS issued final regulations on the reporting requirements for Marketplaces. On July 24, 2014, the Department of the Treasury and the IRS issued proposed, temporary and final regulations providing further guidance on the premium tax credit. In particular, the regulations provide relief for certain victims of domestic abuse or spousal abandonment from the requirement to file jointly in order to claim the premium tax credit. In addition, the regulations provide special allocation rules for reconciling advance credit payments, address the indexing in future years of certain amounts used to determine eligibility for the credit and compute the credit, and provide rules for the coordination between the credit and the deduction under section 162(l) for health insurance costs of self-employed individuals. Rev. Proc. 2014-41, also released on July 24, 2014, provides methods for determining the section 162(l) deduction and the premium tax credit for health insurance costs of self-employed individuals who claim the deduction under section 162(l).
For more information on the credit, see our premium tax credit page and our questions and answers.


Carole Anne Carr said...

I thought the new health care would solve many problems, but obviously not.

Mason Canyon said...

The new health plan sounded so good, but when you begin applying you see that it is worse than ever.