Can’t Work Due to Health, Will I Lose Coverage?
My girlfriend has marginal income. I think she made $19K last year. She purchased a marketplace healthcare insurance plan at beginning of 2014. In Dec, 2014, she had to have major spinal surgery. Also, in December, she chose the same healthcare plan for 2015 as she had in 2014.
She is still recovering and unable to work. I think she can start working again in April.
As a waitress, she will need to apply for a new job and be hired before income begins to flow again. So I understand that there is a minimum income requirement to qualify for marketplace insurance.
She has ongoing health concerns and would like to keep her current insurance, but obviously she cannot afford the premiums without the healthcare insurance premium tax credit.
My questions are:
1) what does she use as income justification for her insurance company (required by end of March) to continue receiving the monthly premium tax credit payment advance, and
2) once she is working again, what if she makes less this year than the minimum income requirement?
Will she be billed by her insurance company for the remaining premium for the whole year? That would be a bill of around $4300! Thanks for any advice.
Answer
If you have health insurance, get sick, use your coverage, but then can't work, so you don't qualify for cost assistance, then you are in a bad place unless your state expanded Medicaid, or you have money saved up to pay for a health plan without assistance.
Luckily for her, all she will need to do is make enough to qualify for the Marketplace to keep her cost assistance this year.
Cost assistance is based on annual household income, not per month income. So her justification is that she predicts that she will qualify based on income, since she will be working again in April. (She'll still need to pay the premium no matter what, or she'll lose the plan).
See the Federal Poverty Level chart. If she makes between 138% - 400% FPL then she can get cost assistance. Please note, as she is planning on going back to work, if she is offered coverage through her employer, she won't be able to get cost assistance after the coverage starts.
If she doesn't make enough money to qualify for cost assistance you'll have to adjust the assistance levels on your taxes. You don't owe back tax credits if you got tax credits, but then didn't qualify because you made too little income. You only owe back credits if you make too much income. See tax credit repayment limits.
Considering her income, she should be looking into Medicaid as a backup plan.