ACA Insurance and subsidies

[Corporate ORphan]

DH and I have been researching getting an ACA policy for 2015. Many people on the message board have been saying it's better to get two policies, with two separate deductibles then a family policy. If you do that how do you put in your income if you file a joint return? You can't just split it down the middle, can you?

Thanks!

 

[Sue J]

You fill out the application as a married couple, using joint household income. After you get through you get your eligibility letter (pdf file) which will tell you the subsidy for both of you combined. After that you'll proceed to finding plans, etc. There is a step in there to designate GROUPS. Put yourself in one group, then add an additional group and put your spouse in that one. When you shop for plans it will be for each of you, one at a time. The subsidy will be half for each of you.

We did this last night and then picked the same plan for each of us. So far it looks like 2 individual plans instead of a family plan. I'm not going to call this finished until I get paperwork or emails from the insurance company just because of how convoluted and crazy this was last year. If they put us in a family plan instead of 2 individuals I will cancel the whole thing and reapply and we will pick 2 different insurers just to avoid the family combined deductible.

 

[papadad111]

How significant a savings is it?

 

[pb4uski]

It could be significant if you have some claims. For example, we are both healthy and have 2 policies each with a $6,350 in-network deductible. So far this year no claims thankfully.

Let's say next year DW gets drunk again and falls and breaks her arm and the total bill is $15,000. (I just made that up BTW). If we had one policy for the two of us the insurer pays $2,300 and we pay $12,700 since the deductible for a policy covering both of us is a aggregate deductible. With separate policies, the insurer pays $8,650 and we pay $6,350.

So in that example by having separate policies we save $6,350. And the premium for two people is double the premium for one person. Talk about caveat emptor!

 

[photoguy]

DH and I have been researching getting an ACA policy for 2015. Many people on the message board have been saying it's better to get two policies, with two separate deductibles then a family policy. If you do that how do you put in your income if you file a joint return? You can't just split it down the middle, can you?

I think this is only beneficial with HSA accounts that only have a family deductible / maxOOP (individual does not apply with 2 or more people on the policy).

If you have a regular plan, then both the individual and family deductible should apply.

This was never clear to me from the sparse documentation on CoveredCA but after downloading the more detailed plan summary from the provider, they have explicit examples showing this. But you should double check with your specific plans though.

 

[pb4uski]

Actually, the example I used would apply to either our old HSA-eligible plan or our current non-HSA eligible plan.... so HSA or not is not the differentiating factor.

The key thing is whether the deductible is aggregate or stacked. If it is stacked, then it probably doesn't matter (assuming the premiums are the same). If it is aggregate, then separate policies are preferable. Some areas refer to the stacled deductible as an embedded deductible.

Aggregate Deductible – A type of deductible in which all individuals in a family contribute to the same
family deductible. When the deductible is met cost sharing (copays and co-insurance) will be in effect.

Stacked Deductible – A type of family deductible that allows for multiple layers of deductibles for
individual family members. An individual’s claims contribute to both an individual and family deductible.
All individuals in a family contribute to the same family deductible. Once either deductible is met cost
sharing (copays and co-insurance) will be in effect

 

[photoguy]

Does the ACA require that exchange plans use aggregate for HSA/HDHP and stacked for regular plans? or is this just the common practice?

As far as I can tell (at least for coveredca), the HSA come with aggregate and stacked for regular plans.

 

[sengsational]

From what I understand, the rule for ignoring the individual deductible on a family policy comes from the IRS rules surrounding HSA eligible plans.

 

[pb4uski]

I was just looking at a chart of plans. All of the HSA plans have aggregate deductibles but there are other plans that are not HSA eligible that have aggregate deductibles.

This link suggests that a HSA qualified plan would have an aggregate deductible so I think you are right that HSA qualified palns much have an aggregate deductible.

For family coverage: family deductible must be met before any reimbursement can be made

 

[Sue J]

YMMV

For 2014 only our insurer's HSA plans had the aggregate deductible. We just got a summary of their plans in the mail for 2015 and ALL their marketplace plans, HSA and non-HSA, for all metal levels have the aggregate deductible.


Sent from my iPad using Early Retirement Forum

 

[Dancer373]

My husband passed away in October. Last year for ACA I used combined income but am now trying to figure out how to to project my income for 2015. I just started SS in July for which they've made mistakes. The SS isn't much. I don't have a head for numbers and things like this. Any guidance would be appreciated

 

[golfnut]

My husband passed away in October. Last year for ACA I used combined income but am now trying to figure out how to to project my income for 2015. I just started SS in July for which they've made mistakes. The SS isn't much. I don't have a head for numbers and things like this. Any guidance would be appreciated

Sorry to hear about your loss. Did you consider calling a health insurance agent? Won't cost you a dime.

 

[Dancer373]

Thanks, never thought of it..........

 

[Sue J]

You fill out the application as a married couple, using joint household income. After you get through you get your eligibility letter (pdf file) which will tell you the subsidy for both of you combined. After that you'll proceed to finding plans, etc. There is a step in there to designate GROUPS. Put yourself in one group, then add an additional group and put your spouse in that one. When you shop for plans it will be for each of you, one at a time. The subsidy will be half for each of you.

We did this last night and then picked the same plan for each of us. So far it looks like 2 individual plans instead of a family plan. I'm not going to call this finished until I get paperwork or emails from the insurance company just because of how convoluted and crazy this was last year. If they put us in a family plan instead of 2 individuals I will cancel the whole thing and reapply and we will pick 2 different insurers just to avoid the family combined deductible.

A customer service rep from the insurer called to let me know that our info did come through from HealthCare.gov as 2 individual policies. I had spoken to her with questions about a month ago and it was very nice that she followed up. I will make the 2 separate payments for January tomorrow and she said member packets will be mailed soon. She even had member numbers for me, so it looks like it really did work.

 

[Helen]

If you do that how do you put in your income if you file a joint return? You can't just split it down the middle, can you?

Thanks!

I did just split our income down the middle. I figured that since we were filling jointly it shouldn't matter which account dividends, interest and capital gains came from.

 

[pb4uski]

I did just split our income down the middle. I figured that since we were filling jointly it shouldn't matter which account dividends, interest and capital gains came from.

I just allocated ours based on whether and account was mine, hers and ours were 50/50 but I think you're right that the true up will be for the two people combined so it shouldn't matter.

 

[Theseus]

You fill out the application as a married couple, using joint household income. After you get through you get your eligibility letter (pdf file) which will tell you the subsidy for both of you combined. After that you'll proceed to finding plans, etc. There is a step in there to designate GROUPS. Put yourself in one group, then add an additional group and put your spouse in that one. When you shop for plans it will be for each of you, one at a time. The subsidy will be half for each of you.

This worked for me - BIG THANK-YOU for the howto, and for other posters who alerted me to the potential pitfalls of an aggregate deductible in a family plan. At first I thought we would likely exceed deductibles anyway so why bother, but then again maybe not; so might as well each have our own plan as it costs no more. And I did verify with the carrier I had selected that this was doable, and yes it was confirmed as being advantageous to us to do so. I also questioned the out of network/HMO emergency care issue, using example of travelling. AS I understood it, if it was an emergency care issue, car accidents, etc it would be treated as in network. But for colds/minor injuries: HMO no coverage outside of HMO, but with PPO plan it goes against out of network deductibles/co-pays. Heck, we are the kind to avoid even going to the doc for that when we're at home, hardly something we'd do away from home - so no sense in paying higher premiums just for the luxury of paying out of network deductibles anyway...

I think the mechanics of the ACA website/interface are working pretty well, just that one really needs to do their homework to know what choices to make in addition to which plan is being selected. Still had to fudge the income questions to take AGI into account, as the website doesn't really even touch on that. Eligibility notice says we need to provide supporting documents by March 3, 2015 to verify my numbers, should be no problems there.

 

[Beststash]

Thank you from me also - I would have never thought of looking at individual policies had I not read your post. Happy Holidays!!

 

[Nunthewiser]

Another bump. I just figured out how this works on the exchange and it is likely to save us a couple of thousand just this year. DW is 53 and just finishing breast cancer treatments this year. Next year she will have some followup. I am healthy at 60. We were going to get a family silver HSA from UNHC for $3000 (after subsidy)with a $2200 Deduct/MaxOOP, but I am unlikely (I hope) to use anything beyond a checkup. I think she will keep that plan and cut the deductable and Maxoop in half, and I can get a bronze HSA plan for $0. I am betting I won't have much go wrong with me, but we will save about $1600.

 

[MBSC]

We were going to get a family silver HSA from UNHC for $3000 (after subsidy)with a $2200 Deduct/MaxOOP, but I am unlikely (I hope) to use anything beyond a checkup. I think she will keep that plan and cut the deductable and Maxoop in half, and I can get a bronze HSA plan for $0. I am betting I won't have much go wrong with me, but we will save about $1600.

For 2015, an HSA eligibile plan must have a deductible between $1300-$6450 for individuals and $2600-$12,900 for family plans. If your ACA cost-sharing subsidies lower your deductible below these amounts, the "silver HSA" becomes a non-HSA eligible plan.

Link: HSAcenter - Health Savings Accounts - Health Care and Savings for You and Your Family

 

[frank]

I am on medicare and my wife is 4 years away from being eligible. can she apply for a single plan on half of our income? when I go to healthcare.gov I always put in our combined income and list 2 people. but it does show that her premiums and deductible are higher than a single plan.

 

[Nunthewiser]

For 2015, an HSA eligibile plan must have a deductible between $1300-$6450 for individuals and $2600-$12,900 for family plans. If your ACA cost-sharing subsidies lower your deductible below these amounts, the "silver HSA" becomes a non-HSA eligible plan.

Link: HSAcenter - Health Savings Accounts - Health Care and Savings for You and Your Family

Thanks for pointing that out!

If I were to "find" another $4K in income next year (cash from a 401K) that silver individual plan for DW would now have a $2800 deductable and $2800 MaxOOP. There doesn't seem to be any "sweet spot" where I can bump it to $1300. Such are the sensitivities of the ACA.

I think I will just skip the HSA for her then (mine is still on and the bigger of the two anyway as I can add the $1K catchup).

No need to be greedy...I am already going to be saving about $2K from my employer's (Lockheed Martin) subsidized EMPLOYEE plan, and about $10-14K from their not-so-nice retiree plan.

 

[CoolChange]

Silver HSA Becoming a non-HSA Plan due to ACA Cost-Sharing

For 2015, an HSA eligibile plan must have a deductible between $1300-$6450 for individuals and $2600-$12,900 for family plans. If your ACA cost-sharing subsidies lower your deductible below these amounts, the "silver HSA" becomes a non-HSA eligible plan.

Link: HSAcenter - Health Savings Accounts - Health Care and Savings for You and Your Family

I just wanted to publicly thank you very much for this information.

I did not realize this and was in fact hoping to use a silver HSA plan with cost sharing in either 2015 or 2016. This could have cost me some money and a large headache if discovered by the IRS down the road. (Of course, I realize things may change by 2016; but, this is something I will need to at least investigate.)