Subsidy eligibility with one employed spouse

[Htown Harry]

The most confusing source of premium tax credit eligibility made simple, in one chart | The Incidental Economist

This chart may be helpful for those of us thinking about semi-ER scenarios where one of the spouses has a low salary but has HI coverage through work.

Many people want to know if they are eligible for premium tax credits for marketplace (exchange) plans. I’ve been asked this question numerous times and seen and heard it asked of others. The typical answer is that if you have coverage from an employer or public program, you are not eligible for tax credits. That typical answer leaves one big thing out. Some people with employer-based coverage are eligible for tax credits. If that coverage is deemed unaffordable, tax credit eligibility is conferred.

 

[Which Roger]

Thanks. I've been wondering about this. I'm ER'd and DW is still working. The YES branch out of "Does employer offer family coverage" seemed wrong, because it only considers the employee's cost in the 9.5% test. But then I read the article, and it's unfortunately correct. It's known as the "family glitch. The article says:

No, the chart is not wrong in saying that a family member is not eligible for tax credits if employee-only (not employer-based family coverage) is affordable. Yes, you will be denied tax credits if employer-based family coverage is unaffordable by any measure, so long as employee-only coverage is affordable

 

[samclem]

And did we ever figure out if insurance offered by former employers to pre-Medicare retirees counts as "employer-provided insurance"?

Regards the "family glitch"--wow, another doozy. Who would have thought, with all these smart people working on this. There's something to be said for open processes and trial runs/test cases.

 

[ERD50]

And did we ever figure out if insurance offered by former employers to pre-Medicare retirees counts as "employer-provided insurance"?

Yes, this is a Q for many of us ER types. My former employer retirement HI costs are in excess of 9.5% of my expected MAGI. I had previously thought having this coverage excluded me from any subsidies, but maybe not?

Regards the "family glitch"--wow, another doozy. Who would have thought, with all these smart people working on this. There's something to be said for open processes and trial runs/test cases.

I've often said, complexity breeds complexity. Rather than simplify the root causes, I expect even more complex 'solutions'.


-ERD50

 

[Which Roger]

And did we ever figure out if insurance offered by former employers to pre-Medicare retirees counts as "employer-provided insurance"?

I've been asking the same question for quite a while. On the one hand, it seems that there must be a definitive answer to this question somewhere. On the other hand, if there was, somebody in this forum would have been smart enough to find it.

 

[lemming]

both yes/no boxes say >9.5% premium. From what I have read so far if it is less then the affordability limit, the family can't get a subsidy either. That leaves out a lot of people

 

[rbmrtn]

I've been asking the same question for quite a while. On the one hand, it seems that there must be a definitive answer to this question somewhere. On the other hand, if there was, somebody in this forum would have been smart enough to find it.

I thought it was covered in another thread. Retiree coverage is considered coverage for the individual requirement but if you want to use the exchange you can. Based on this FAQ on healthcare site

https://www.healthcare.gov/what-if-im-retired-but-not-eligible-for-medicare/