Can I Choose ObamaCare Over Medicaid?
My husband and I have been on Obamacare for a year and would like to continue while I am still seeking work we saved money to continue while I am seeking work, my husband is retired but not collecting his until he reaches 62.
California says we have to go on Medicaid please advise we would like to keep our Bluecross coverage.
Answer
If your income is below 138% of the Federal Poverty Level, and you live in a state that expanded Medicaid, you can't get cost assistance and must choose private insurance or Medicaid. Medicaid is a form of cost assistance, and typically it is cheaper and provides better coverage than low premium private Marketplace plans. So while the lack of choice may seem unfair, the value you'll get with Medicaid will almost always be better. You can choose a higher premium plan, but you won't get cost assistance. So keep that in mind.
The same thing works with Medicare. If you are eligible for Medicare, that is the only public cost assistance you can get.
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Putting aside whether it is a good idea or not, if I understand this correctly I could buy private insurance through the heathcare “Marketplace” (healthcare.gov) even if I was qualified to receive Medicaid, but I would not be eligible for any cost support/premium tax credit. Is this correct?
Yes 100% correct. Essentially anyone can use the marketplace unless they have access to Medicare (then it is illegal to sell the person a non-medicare plan). Medicaid is an option at low incomes, but not mandated.
Your answer seems very concise. However, if one goes on Medicaid, will their hard-earned dollars in a 401K eventually be taken in order to reimburse Medicaid? In that case, wouldn’t it be better to purchase insurance even at full price and even as a 401K withdrawal?
Hmmm, honestly a good question. In general, though you are going to only run into estate recovery due to things like long-term care for those 55+. So you have a 10 year period in which you haven’t hit the age to withdraw from your 401k but may be subject to estate recovery. In that time if you are in “payout status” then funds from your 401k arent’ counted toward “spend down” rules and paying for care. Given the rules existing around all this right now, what you mention could or could not be helpful depending on a care-by-case basis. In short, good thinking but its a bit more complicated due to all the existing rules 🙂