Potential major good news on ACA premiums

I have a similar question to yours.
My income level on Covered California is correct. I'm retired and Covid has not affected me in any way. As I understand it if I go over I will not be penalized which makes me think 2021 is a good year to do a larger than normal Roth conversion and just pay the taxes but will not affect Covered California in any way. Am I missing something here, it just doesn't sound right? Seems the legislation should only apply to people actually affected by Covid. Having said that it's not the first time I've seen some poorly written laws that are full of holes that people can take advantage of.
 
OP here with an update on our particular situation just FYI.

Our Silver ACA plan here in Tucson, AZ went from $118 a month to $42. It gives us a year to sock away money (provided we don't spend it all on meeting our out-of-pocket maximum like we did last year) in preparation for next year when I have to go on Medicare which will (ironically) INCEASE our total monthly premiums (for me on Medicare A, B and C and DW on an ACA plan) to ~$250 per month.

Needless to say, you won't hear me complaining - this year or next. Of course the long-term situation is unknowable and major reforms are needed to build on ACA or replace it with something better (bites tongue for fear of veering off into politics).
 
explanade said:
CoveredCA sent formal letter that I am now eligible for premium assistance in response to my query.

The assistance is almost half my premium now!

Says it will be a tax credit though so I have to wait until I file my tax returns?

But I hadn't touched my CoveredCA profile since 2014 when I first enrolled and the income level they used to calculate the assistance is about 20-25% lower than my likely income this year.

So will I be penalized if I get a bigger assistance than I was entitled to, especially if they reduce my premiums for the rest of the year? Of course I've already paid through May at the full premiums level already.
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It depends on how much subsidy you're actually entitled to. Since you've already paid 100% for Jan to May and you'll be paying 50% for Jun to Dec, you'll end up averaging just over 70% for the year. If your actual subsidy should be less than 30% of the premium, you'll have to pay some of it back when you do your taxes next year. For 2020, the overpayment was forgiven, but that doesn't apply to 2021 as of now. (Otherwise there would be too much incentive for taxpayers to try to maximize the subsidy amount they receive.)

My suggestion is to use one of the online calculators to figure out what your actual Federal subsidy should be this year and then use that info to decide whether to update your income level on CoveredCA or not.

Don't forget that there's also a small state subsidy in California. My observation, both from doing our taxes and from doing lots of other people's taxes as a volunteer, is that the state did not calculate its subsidies correctly in 2020. Most people who get health coverage on the exchange, even those who would normally have had to repay part of their Federal subsidy, are getting some extra premium tax credit back on their state returns. Before tax season I would have expected that since both the Fed and state credit calculations are based on the same income, you'd either owe on both or get more subsidy on both, but it hasn't worked out that way.
 
RetiredAndLovingIt said:
I have a similar question to yours.
My income level on Covered California is correct. I'm retired and Covid has not affected me in any way. As I understand it if I go over I will not be penalized which makes me think 2021 is a good year to do a larger than normal Roth conversion and just pay the taxes but will not affect Covered California in any way. Am I missing something here, it just doesn't sound right? Seems the legislation should only apply to people actually affected by Covid. Having said that it's not the first time I've seen some poorly written laws that are full of holes that people can take advantage of.
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Yes, you are missing that the advance premium tax credit reconciliation and repayment is back in effect for tax year 2021. If you understate your income on Covered CA and get too much subsidy as a result, you will have to repay it when you do your 2021 taxes.
 
SecondCor521 said:
It was an email from YourHealthIdaho sent on March 30th.

Quoting in relevant part:

"You may qualify for enhanced subsidies!
The American Rescue Plan Act of 2021 was signed into law on March 11, 2021. The plan provides access to affordable health insurance coverage through the Marketplace by increasing eligibility for financial assistance.

Because you are enrolled in a health insurance plan with Your Health Idaho and have been previously approved for an Advanced Premium Tax Credit (APTC), you may see an increase in your prior tax credit eligibility.

What does this mean for you?
Your tax credit will be recalculated by the Idaho Department of Health and Welfare (DHW), which may reduce reducing your monthly premium based on the percentages set in the American Rescue Plan. The updated APTC will be applied to your account directly. No further action is required. However, if you would like to review your APTC, or change the amount you use each month, you can do so via your account at YourHealthIdaho.org.

Your new monthly premium goes into effect on April 1, 2021, although carriers may have already completed the April billing cycle before the updated tax credit amounts were confirmed. If you have specific questions about your account, please work directly with your carrier."

As to your second question, no, I have not seen any adjustment to my premium yet on YourHealthIdaho, although I do have some sort of strange credit on my health insurer's website on my April statement, so that may be it. It's hard to tell because I have had several recent changes and adjustments and refunds completely unrelated to ARPA, so I wasn't in a boring steady state that would make it easy to figure out what was going on. I figure I'll sort things out at tax time on my 8962.
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Ok, I looked through my inbox and found the email. Thanks very much. Turns out our premium will drop significantly.
 
KFF expects many insurance companies will be needing to issue rebates this year due to the medical loss provision in the ACA, I got a $600 check last year from BCBS.
https://www.kff.org/private-insuran...insurers in the,issue $310 million in rebates.

The Medical Loss Ratio (MLR) provision of the Affordable Care Act (ACA) limits the amount of premium income that insurers can keep for administration, marketing, and profits. The ACA requires health insurers to publicly report the portion of their premium dollars spent on health care costs, quality improvement, and other activities in each state they operate in. MLR rebates are based on a 3-year average, meaning that 2021 rebates will be calculated using insurers’ financial data in 2018, 2019, and 2020. Rebates issued in 2021 will go to consumers who were enrolled in rebate-eligible plans in 2020.

Using preliminary data reported by insurers to state regulators and compiled by Mark Farrah Associates, we find that insurers estimate they will be issuing a total of about $2.1 billion across all markets – the second-largest amount since rebates were first issued in 2012 under the ACA.
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Yeah the MLR rebates we've gotten from Ambetter the last couple of years basically paid for our subsidized Silver plans. I expect the same later this year when they issue another MLR for prior years.
 
Basic question: I'm getting info from healthcare.gov saying that "Monthly Premiums are decreasing by...". Is the full cost of the premium changing, or are they really saying that the subsidies are increasing, so it's just the customer's share of the cost that will be lower? I think it's the latter, and if I don't act, I don't lose in the end as it all gets resolved at tax time, but requesting a definitive answer.
 
Which Roger said:
Basic question: I'm getting info from healthcare.gov saying that "Monthly Premiums are decreasing by...". Is the full cost of the premium changing, or are they really saying that the subsidies are increasing, so it's just the customer's share of the cost that will be lower? I think it's the latter, and if I don't act, I don't lose in the end as it all gets resolved at tax time, but requesting a definitive answer.
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On mine it was the subsidy that increased.... premiums stayed the same.
 
Which Roger said:
Basic question: I'm getting info from healthcare.gov saying that "Monthly Premiums are decreasing by...". Is the full cost of the premium changing, or are they really saying that the subsidies are increasing, so it's just the customer's share of the cost that will be lower? I think it's the latter, and if I don't act, I don't lose in the end as it all gets resolved at tax time, but requesting a definitive answer.
Click to expand...

You're correct on all points.

The subsidies were increased in the recent ARP Act, which means the customer's premiums after subsidy went down.

Your state exchange and insurer probably will adjust things for you, but if they don't, then it should all get reconciled at tax time on Form 8962.
 
With Covered CA, how are ya'll even evaluating plans? When I played with it, it seemed like it didn't matter if you picked HMO or PPO, none of them cover anything at all out of network....so who has the biggest and most robust network?
 
teej1985 said:
With Covered CA, how are ya'll even evaluating plans? When I played with it, it seemed like it didn't matter if you picked HMO or PPO, none of them cover anything at all out of network....so who has the biggest and most robust network?
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Responding to me own question, this agent's website seems to be a great resource on CA ACA plans, has info on off-exchange plans, too:

https://insuremekevin.com/
 
DGF received her confirmation letter last week for her revised premium with Kaiser Permanente. Her Cost Sharing Silver Plan premium was reduced from $50 per month to $1.96 per month. The identical plan last year was $260 per month.
 
Having a heck of a time making sense of the new ACA subsidy limit changes but this thread has helped quite a bit! Like many here, my main concern is exceeding the MAGI income estimates I give to the ACA at the start of each new year and then having to repay the subsidies they payout on our behalf come tax time. After reading this thread and info on the IRS website, it appears we may not need to worry about exceeding our MAGI limit for tax year 2020 as no ACA subsidy repayments will be required - correct? Also, that change does NOT apply to current tax year 2021 - correct? I also keep reading that the max someone on the ACA will be required to pay for healthcare in 2021 will be 8.5% of I'm guessing your MAGI since that's what's always used for current income/subsidy caps? This all sounds very promising for those of us walking that ACA subsidy/income tightrope each year and I'm still trying to decipher it all!
 
Money is literally falling out of the sky........for everyone!

If the huge savings on my healthcare premiums weren't enough, I filled out my 2020 property tax rebate form earlier today, & found I'll be getting $520.00 back.

The best part is, none of it will ever have to be paid back.
Yippee-Ki-Yay :dance:

Blue skies smilin' at me
Nothin' but blue skies do I see
Bluebirds singin' a song
Nothin' but blue skies from now on
I never saw the sun shinin' so bright

Never saw things goin' so right
Noticing the days hurrying by
When you're in love, my how they fly by
Blue days, all of them gone
Nothin' but blue skies from now on

Blue skies smilin' at me
Nothin' but blue skies do I see
Blue days all of them gone
Nothin' but blue skies from now on
Blue skies smilin' at me

Nothin' but blue skies do I see
Blue days all of them gone
Nothin' but blue skies from now on
Blue skies smilin' at me
Nothing but blue skies, do I see

Blue days all of them gone
Nothin' but blue skies from now on.......

"Blue Skies" written by Irving Berlin in 1926
 
I am happy for all of you that be able to reduce the monthly premium, but I am from CT and I have not received anything on this subject from state or insurance company. I called state representative last month and she said the state is looking into this. But I just auto paid May premium. So I chatted online with the rep and she doesn't seem know what I am talking about.

Is anyone from CT here? what is your experience?
 
Eucerin said:
I am happy for all of you that be able to reduce the monthly premium, but I am from CT and I have not received anything on this subject from state or insurance company. I called state representative last month and she said the state is looking into this. But I just auto paid May premium. So I chatted online with the rep and she doesn't seem know what I am talking about.

Is anyone from CT here? what is your experience?
Click to expand...

I'm not from CT, but did you review the notice on your state's health exchange website? I found this there...

https://help.accesshealthct.com/en_US/885658-american-rescue-plan

It seems like it describes what you need to do.
 
I decided to call the Pennsylvania exchange (pennie.com) since they still have ambiguous wording (in my opinion) on their website about what one should do to trigger the larger subsidies. Before calling, I had partially followed the advice on the website to edit my 2021 application and re-submit it (even if you changed nothing). But after it started asking me questions that confused me, I stopped editing. So I called their help line and an agent saw that I had edited the application. She said all she needed to do was re-submit it for me, which she did. She said my new subsidies (an additional $105 per month) should take effect with the June 1 premium. My insurance company generates that around the 10th of the preceding month, so we will see if they have the updated information or not. I'm confident it will kick in as soon as possible now.

I hope they don't restart my deductible, but that won't be the end of the world, since I don't really have much on it yet.
 
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In Biden's new relief bill of one bazillion dollars, there are funds in there to make the new subsidies permanent. Whether or not that provision makes it through congress is a different matter.
 
Thanks to the COVID relief law, many current enrollees can find additional savings

I have been receiving texts and emails suggesting that since I have ACA that I look for a new plan at a discount. Is anyone changing their plans and if you change your plans, does your deductible that you have paid so far start over at $0?
 
merged with active thread
 
Wille said:
I have been receiving texts and emails suggesting that since I have ACA that I look for a new plan at a discount. Is anyone changing their plans and if you change your plans, does your deductible that you have paid so far start over at $0?
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I did not change plans...


As to changing plans and deductible... I would guess you start again at zero... now, if you keep the same company buy change to a different plan (say gold from silver) you might get away with it... I would call to be sure..
 
Wille said:
I have been receiving texts and emails suggesting that since I have ACA that I look for a new plan at a discount. Is anyone changing their plans and if you change your plans, does your deductible that you have paid so far start over at $0?
Click to expand...

I also had no reason to change plans. On our exchange in Pennsylvania, they caution you:

1. If changing plans within the same insurance company, contact the company to see whether they will be resetting deductibles/OOP values.

And

2. If changing insurance companies, you should expect the deductible/OOP values to be reset.

I don’t believe there are any ACA rules requiring insurance companies to carry these numbers over during policy changes.
 
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