I am a housewife. My husband passed away last year and I and my 2 kids, aged 6 years old and 4 years, are earning survivor’s benefits from my husband’s social security. I tried applying for insurance from the marketplace, but got rejected. What is the qualified income for me to be able to get obamacare under my circumstances? I am still not working and I am surviving on my husband’s monthly survivor’s benefits.


When you apply for the Marketplace or Medicaid your eligibility is based on total household income, this Includes income from survivor's benefits. With that said, the rules are a bit complex and whether or not income is included depends on other taxable income.

There are a few key points to understand here:

First off, survivor benefits can have some complicated tax rules. As a rule of thumb, if the benefits are taxable, they count toward MAGI for the marketplace and Medicaid, and if they aren't they do not. However, there are some exceptions and those exceptions can differ between the Marketplace and Medicaid (see details). If you need assistance in figuring out what you qualify for, you can always contact the marketplace or your local social security office for help!

Second, as a rule of thumb, Social Security income specifically is counted toward MAGI for ObamaCare and thus affects tax credits and Medicaid eligibility if a person has to file taxes. Social Security Income includes disability payments (SSD and SSDI), pension, retirement benefits, and survivor benefits, but does not include supplemental security income (SSI). (Line 20a minus 20b on a Form 1040). In general, everything except for SSI counts toward MAGI for ObamaCare and Medicaid.... however, it can be the case that a child doesn't have enough other taxable income for it to count (see specific rules for children here: https://www.irs.gov/faqs/social-security-income/survivors-benefits/survivors-benefits).

Therefore, as a rule of thumb, survivor benefits will count toward taxable income for the purposes of assistance with healthcare in many cases (in most cases where those benefits are taxable).

All of that said, there is one more thing to consider here in terms of Medicaid specifically: If your state did not expand Medicaid you may not have a lot of options if taxable benefits won't put you over the threshold. We suggest those with low incomes, who live in states that didn't expand Medicaid, to apply for Medicaid and use their rejection letter to apply for an exemption in the Marketplace.

TIP: You can use the marketplace no matter what as long as you don't qualify for Medicare. Meanwhile, if you qualify for Medicaid the marketplace will let you know. So even if you don't get tax credits, you should still contact the marketplace to inquire about coverage.

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Mary Harvard on

Here you say a parent’s SS Survivor Benefits do not count as household income when applying for the marketplace, but on this page — https://obamacarefacts.com/modified-adjusted-gross-income-magi/ — it says they do for Medicaid eligibility.
So what if someone can’t go through the Marketplace because they don’t have enough income, but then when they go to apply for Medicaid, they have to count the Survivor Benefits as income and make too much to qualify. What then?

ObamaCareFacts.com on

SS survivor benefits count as income for both MAGI and the Marketplace. I’ll look at the page again to ensure that is clear. So then, the case you are referring to wouldn’t happen. The SS benefits would count as income and qualify you for ObamaCare’s Marketplace.

Tracy on

This has happened to me. I was denied a tax credit on the marketplace because they DO NOT take into account my children’s survivors benefits and was told to apply for medicaid. Applied for medicaid, only to be denied by them because they DO take into account my children’s survivors benefits

ObamaCareFacts.com on

This was a new rule with the PPACA, from our research what we present below is right. One of the two sources is incorrect, you should reapply and appeal. They either count them or they don’t based on if your children are filing taxes as stated in the answer. You can verify this, but that is what our research turned up. Sometimes rules differ between Medicaid and the Marketplace, but it wouldn’t make sense for this one.

Mandy on

So yes or no??? What did you do?

ObamaCareFacts.com on

I think the confusion here is due to the whole thing being a little technical and hard to word:

Taxable and non-taxable Social Security income is counted toward MAGI for ObamaCare and affects tax credits and Medicaid eligibility, but only if a person has to file taxes. Social Security Income includes disability payments (SSD and SSDI), pension, retirement benefits, and survivor benefits, but does not include supplemental security income (SSI). (Line 20a minus 20b on a Form 1040). In general, everything except for SSI counts toward MAGI for ObamaCare and Medicaid…. except for the rules about dependents and tax filing noted above.

See: https://obamacarefacts.com/modified-adjusted-gross-income-magi/ (specifically see section How Social Security Works With MAGI and ObamaCare).

Laura on

This happened to me, but the state had to provide CHIP insurance for my child. Even though I had previously applied for her and was denied, once I applied for insurance through the marketplace, they said she qualified for it and the state had to give it to her.

Agent on

I have a client in this very situation. She is a young widow with 2 young boys. Her income is below the 100% FPL so she doesn’t qualify for a tax credit for the health insurance and our state (Nebraska) doesn’t have expanded Medicaid so she is stuck with no subsidy and IF she wants insurance she has to pay 100% of the premium, which is over $400 monthly at this time…I can’t get a direct answer from anyone as to IF we could count the boys’ SS Survivor benefits toward the household income…if we could, she would be above the FPL level and qualify…when I called the Health Insurance Marketplace they’ve given both answers, yes we can and no we can’t…so we don’t know what to do and don’t want to cause her any problems at tax time. (Each of the 3 receive $742 monthly and the kids do qualify for Medicaid)

natali altenburg on

This rule is confusing because Social Security income is considered “unearned income,” but in most cases, it is not counted when determining if the child or tax dependent is required to file taxes. Under IRS rules, only taxable Social Security is used to determine if an individual meets the tax-filing threshold. A single individual has taxable Social Security income only if half of the Social Security income plus other income exceeds $25,000. Therefore, if a child or tax dependent’s only income is Social Security benefits, it is unlikely that the individual would be required to file a federal income tax return, and the Social Security benefits will not be included in the total household income. However, if the dependent is required to file income taxes (for example, due to earnings from a summer job), then all of the dependent’s income, including the non-taxable Social Security benefits, will be included in the total household income.”
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Natali Lynn Altenburg
Natali Lynn Altenburg ^^ how in the heck does this make any sense????
between the survivors benefits and the unearned income my 7 year old son earns way under 25000 – but because the unearned income is over 1050 he has to file taxes – or i can add the info to my taxes (which i did – this is the first year since 2012 thats he’s gone over 1050 for the year) – this unearned income is untouchable until he is 19 – so 12 more years… definitely not able to use to pay for a freaking bandaid! – but because of that unearned income from his dads life insurance policy im forced to include his survivors benefits and not be eligible for assistance with health insurance? am i reading this right?

Arlene on

I will be turning 60 in July. I am a widow and was informed I can collect social security based on my deceased husband at 60.
I am currently working part time and have gotten my healthcare through the market place. If I decided to leave my part time job can I still keep my healthcare through the market place and collect my husbands social security?

ObamaCareFacts.com on

If your Social Security income is taxable (as it should be in this case https://www.thebalance.com/are-social-security-survivor-benefits-taxable-4156656), then it may lift your income enough to qualify you for marketplace tax credits. If not, then you may qualify for Medicaid depending on your state.

If Medicaid isn’t an option, then you have to be careful about your income. You’ll need to make at least 100% of the poverty level to qualify for the ACA’s marketplace tax credits.

Heaven on

Can a parent of a dependant child who receives the survivor benefits be eligible for Medicare like some one on disability is eligible or do they still wait until 65 to become eligible? I am a mother to a six year old and my husband passed away while on disability. I can’t afford $188 ! Month for Obama care. Especially when with that payment it’s all out of pocket until $6000 is paid. I thought that I read that wrong but that was what the deal. $189 per. Month and I pay out of pocket for EVERYTHING myself until I pay the $6000 in medical costs then they will be so generous as to pay maybe 50% of APPROVED SERVICES ONLY! Can anyone tell me how this amount is supposed to be helpful to low income people? Maybe I just don’t understand it so I thought Medicare maybe if I’m eligible???

ObamaCareFacts.com on

That is a good question. Survivor benefits don’t impact eligibility for Medicare but do count as income for marketplace tax credits and Medicaid/CHIP. Despite this, you may find you still have options for your family via CHIP. I do not know your exact income, so I don’t know exactly where to point you, but I would look into Medicaid, CHIP, and marketplace eligibility based on your income to see what degree of assistance you do qualify for. Even if you don’t qualify, your kids might as well.

One place to start is by calling the marketplace, healthcare.gov. Another is by calling the state Medicaid office. I hope it goes well!