ACA questions

[GenXguy]

Actually I was not confused by SecondCor521's response. He made it clear that it was monthly prorated, thus it didn't matter what month I took the full pension. He answered this question fully plus a few follow ups.
I trust his responses plus cathy63's opinions on tax issues.

Well, from your follow-up questions, you started asking about partial year income, but you arrived back at the right answer again, so I guess that's what matters. But the original response about it being based on full year MAGI was correct.

 

[SecondCor521]

The recon is full year MAGI, but since you only have 2 months insurance only those 2 months would get a low to none subsidy due to high income.

This is inaccurate, at least if I am understanding what you're saying.

A single person with $48K of income in February 2025 and no other income the rest of the year and on ACA for two months living in the lower 48 would be at 319% of the FPL and would therefore receive an ACA subsidy for those two months. The amount of the subsidy they receive would depend on their unsubsidized premium and the applicable SLCSP.

Even if they receive $48K in one month, the way the math works on Form 8962, it's treated exactly the same as if they receive $4K each month in the entire year.

As an aside, Medicaid works on monthly income, and since Medicaid and ACA are both federal health programs but one is monthly and one is annual and they're both complicated, the interaction between those two can be complicated.

 

[jim584672]

This is inaccurate, at least if I am understanding what you're saying.

A single person with $48K of income in February 2025 and no other income the rest of the year and on ACA for two months living in the lower 48 would be at 319% of the FPL and would therefore receive an ACA subsidy for those two months. The amount of the subsidy they receive would depend on their unsubsidized premium and the applicable SLCSP.

Even if they receive $48K in one month, the way the math works on Form 8962, it's treated exactly the same as if they receive $4K each month in the entire year.

As an aside, Medicaid works on monthly income, and since Medicaid and ACA are both federal health programs but one is monthly and one is annual and they're both complicated, the interaction between those two can be complicated.

APTC recon is calendar year basis. It doesn't matter in what months you get the income. I am confused as to what you think I said.

Medicaid is "point in time" monthly income.

 

[SecondCor521]

APTC recon is calendar year basis. It doesn't matter in what months you get the income. I am confused as to what you think I said.

In the context I thought we were talking about ($48K AGI one person 2025 lower 48), that is 319% of FPL and would be eligible for subsidy. I'm unclear on what you mean by this partial phrase:

those 2 months would get a low to none subsidy due to high income.

 

[jim584672]

In the context I thought we were talking about ($48K AGI one person 2025 lower 48), that is 319% of FPL and would be eligible for subsidy. I'm unclear on what you mean by this partial phrase:

You only have to cover 2 months with ACA insurance. If you had a high income year your subsidy would be needed for those two months so the damage isn't that bed.

 

[SecondCor521]

You only have to cover 2 months with ACA insurance. If you had a high income year your subsidy would be needed for those two months so the damage isn't that bed.

OK, I think I understand now. Thanks for the explanation.

 

[sengsational]

What helps this be more confusing than it needs to be is the ACA application asks about monthly income, which is irrelevant... it's all about the annual total. Then that value is used along with the number of person-months of eligibility to continue the calculation.

 

[jim584672]

What helps this be more confusing than it needs to be is the ACA application asks about monthly income, which is irrelevant... it's all about the annual total. Then that value is used along with the number of person-months of eligibility to continue the calculation.

They are asking about monthly to determine if you should be put in Medicaid, it is not irrelevant.

 

[sengsational]

I thought I was putting zero for monthly and entering my Roth conversion in one field. But maybe I was dividing by 12 so it added up to the single Roth conversion income.

 

[jim584672]

I thought I was putting zero for monthly and entering my Roth conversion in one field. But maybe I was dividing by 12 so it added up to the single Roth conversion income.

If your state has no Medicaid expansion then it would be irrelevant.

 

[cathy63]

What helps this be more confusing than it needs to be is the ACA application asks about monthly income, which is irrelevant...

This must depend on which exchange you use. CoveredCA's income reporting tool lets you select a category of income or deduction, enter an amount, and then choose whether it's annual, monthly, weekly, twice a month, every two weeks, daily or hourly. I just renewed our coverage yesterday and had to adjust our numbers for HSA deductions and Roth conversions, both of which I entered as annual numbers.

 

[jim584672]

NY asks annual income and income in the last 30 days. If the 30 day number is under $1,732 you go to Medicaid. Even if the annual number is way over.

 

[GenXguy]

I recall last year, I started to apply in November, and it was asking me about November income. Then when I actually applied in December, it asked me about December income. I wasn't planning to start the plan until Jan 1. Anyway, somewhere along the way, it asked me my estimated income for 2024. I also recall responding to a question that my income would be less in 2024 due to change in work or such.

I have the ACA Eligibility Results form from last year which includes a line "Likely not eligible for Medicaid because this month's household income of $X is too high." And it has a line, "Estimated 2024 income used to determine eligibility for financial help: $X" which is the number I calculated myself on an annual basis, with no relationship to the Nov or Dec monthly figures.

NY asks annual income and income in the last 30 days. If the 30 day number is under $1,732 you go to Medicaid. Even if the annual number is way over.

I thought it was for November and December income specifically that they were asking me about the two times I went in to start the application, but those months were not over. It's possible November could have made me eligible for Medicaid but December put me way over, which is when I actually applied.

 

[PaunchyPirate]

Keep in mind that there are multiple ACA exchanges in this country. Not everyone's experience will necessarily be the same as yours is. States have the right to create their own exchange and opt out of using the Federal healthcare.com site. Each state site may/will have different nuances. On our beloved Pennsylvania ACA Exchange site -- penny.com -- they simply ask what your estimated total income will be in the calendar year. I have never had to put in a monthly estimate. At least so far. I'll know in a week or so if they have changed that for 2025.

 

[GenXguy]

Yeah, I was referring to the Federal Exchange, although Illinois will be moving to a state exchange but not for another year.

 

[Alex The Great]

This must depend on which exchange you use. CoveredCA's income reporting tool lets you select a category of income or deduction, enter an amount, and then choose whether it's annual, monthly, weekly, twice a month, every two weeks, daily or hourly. I just renewed our coverage yesterday and had to adjust our numbers for HSA deductions and Roth conversions, both of which I entered as annual numbers.

Actually, on coveredca it looks a bit confusing. Indeed, the tool allow to enter all these numbers but you can choose the start date and not the end date which is always current. But I wanted to enter the numbers for entire 2024, and projection for 2025. Does it have something to do with my situation only?
The numbers for 2023 were irrelevant since I've not been on ACA through 2023, I did have an income from employer that year and everything was different.

 

[cathy63]

Actually, on coveredca it looks a bit confusing. Indeed, the tool allow to enter all these numbers but you can choose the start date and not the end date which is always current. But I wanted to enter the numbers for entire 2024, and projection for 2025. Does it have something to do with my situation only?
The numbers for 2023 were irrelevant since I've not been on ACA through 2023, I did have an income from employer that year and everything was different.

Enter the numbers for 2024 and save them with your 2024 application. If you don't have CoveredCA in 2024, then you don't enter numbers from the past when you're applying for 2025.

If you do have a 2024 application, then when you renew for 2025, it will show you your current income from 2024. You can edit each line and either say it's ended or adjust the amount and apply a new start date, which if it's something like an HSA deduction or Roth conversion, can be 1/1/2025. After you change the amount it will show two lines, one for prior to the new start date and one for after the new start date. When it calculates your subsidy, it will only use the amounts that are active for 2025.

 

[Flieger]

For eligibility (after normal enrollment period), does retiring in say, June, and therefore losing job based health insurance qualify for special enrollment period? Asking for a friend....

Flieger

 

[audreyh1]

For eligibility (after normal enrollment period), does retiring in say, June, and therefore losing job based health insurance qualify for special enrollment period? Asking for a friend....

Flieger

Yes. Change in employment qualifies.

 

[Flieger]

Yes. Change in employment qualifies.

Thanks! It didn't specifically state a retirement "induced" loss of insurance (which I count as voluntary) so just checking if anyone else had "tested" that situation!

Flieger

 

[cathy63]

When you retire, you'll have the option to sign up for COBRA by paying 102% of the total premium cost. Declining COBRA does not prevent you from going on ACA, but for some people COBRA is a better deal anyway.

• if you made good money during the first part of the year you may not qualify for an ACA subsidy
• if you've already paid some medical expenses you have to start over with a new deductible and OOP max when you go on ACA
• COBRA premiums are not age rated and ACA premiums are in most states, so if you're in an older age group COBRA can actually be cheaper and it's often better coverage with a wider network

For our situation, it was best to stay on COBRA through the end of December and switch to ACA in January.

 

[SecondCor521]

Thanks! It didn't specifically state a retirement "induced" loss of insurance (which I count as voluntary) so just checking if anyone else had "tested" that situation!

Flieger

I tested the situation in 2016. Retired/quit/FIREd from my job on February 19th, had health insurance through the end of the month, then started ACA insurance coverage on March 1st.

I did have to sign up for ACA insurance before February 15th to get it to start March 1st, but I had done my research so that was easy. I think that's still the rule - you have to sign up by the 15th of the previous month. ACA insurance always starts on the 1st.

 

[AllDone]

Thanks, that's excellent news!

You need to sign up in advance. Since you start Medicare in January, go to medicare.gov and set up your account now. There's a lot of stuff to read and understand.

 

[Trailwalker]

You need to sign up in advance. Since you start Medicare in January, go to medicare.gov and set up your account now. There's a lot of stuff to read and understand.

I have a little time. January, 2026.

 

[GenXguy]

I've been getting emails from healthcare.gov about needing to renew my ACA plan. I finally went there today rather than doing it in December like last year.

I put in estimated income of $350 for November (which is a lot lower than my December income, so much lower monthly amount than entered last year) and put $30,000 for my estimated 2025 yearly income.

Despite the $30,000 figure, it said I might be eligible for Medicaid, and that my information was being submitted to my state, and to wait to hear from the state, and I had no option to renew my ACA plan!

Fortunately, I was able to go into the application and change my November income along with answering a bunch of questions again so that it would let me renew my ACA plan for 2025.