ACA Unpleasant SLCSP Surprise

[scrabbler1]

I'm not sure how a SLCSP number would have any impact on if someone goes over the cliff, am I missing something?

You beat me to it. As someone who has gone over the cliff a few times, the SLCSP's value becomes meaningless. I didn't have to include it on Form 8962 because it was among the many lines I was allowed to skip while completing the form. All I did, after determining I had gone over the cliff, was to enter the total amount of the subsidy I had received as an amount I had to give back.

 

[PaunchyPirate]

I'm not sure how a SLCSP number would have any impact on if someone goes over the cliff, am I missing something?

I probably came up with a wrong issue. I can't visualize in my head how it would have an impact now that I think about it. I retract my comment, until further notice.

 

[scrabbler1]

You can find FPL figures in lots of places. The official ones are in the Federal Register, but it's easy to google for them on many other sites. ACA uses the prior year's numbers because the current year info isn't published until January. Here's a page that has them for the past few years: https://obamacarefacts.com/federal-poverty-levels-for-aca-coverage/

Here are the ones for 2023 that will be used in next year's ACA calcs (they aren't 100% guaranteed final, but it's unlikely that they'll change now): https://aspe.hhs.gov/topics/poverty-economic-mobility/poverty-guidelines

I think the percentages table in the form 8962 instructions should be good through 2025. The Inflation Reduction Act extended the change that was put in place by ARPA for 2021/22.

Yes, I realized this after I made my other post. I did a quick internet search to find it, taking into account that the tax form's amount is one year behind, as you mentioned. And it's good to know the %-of-MAGI table won't be changing for a few years. I'm not really sure why it changed a little bit in the earlier years of the ACA, but it's not that important to know why.

 

[jim584672]

The FPLs for 2023 have been published in the Federal Register, so it is official.

https://www.federalregister.gov/doc...5/annual-update-of-the-hhs-poverty-guidelines

 

[SecondCor521]

You beat me to it. As someone who has gone over the cliff a few times, the SLCSP's value becomes meaningless. I didn't have to include it on Form 8962 because it was among the many lines I was allowed to skip while completing the form. All I did, after determining I had gone over the cliff, was to enter the total amount of the subsidy I had received as an amount I had to give back.

One of the many recent changes in the law has to do with the cliff.

It used to be that if a person were over 400% FPL, they had to pay back all of their APTC. The infamous cliff.

Now, they only have to pay back the amount of subsidy that exceeds (SLCSP - 8.5% of their AGI). So now there is a phase out range, and the SLCSP matters in that range.

The cliff is suspended (pending further action by Congress) until 12/31/2025.

As a practical matter, since 8.5% of 400% of FPL is a big number, this only will only affect people with fairly high unsubsidized premiums such as older folks, tobacco users, and people who live where healthcare prices are expensive.

Here's an article discussing this aspect of things: https://www.healthinsurance.org/obamacare/beware-obamacares-subsidy-cliff/

 

[niven]

I just want to add the Applicable Percentage Table (the table that lists the % range of FPL you fall under and the range of percentages you have to pay for coverage) in the past was adjusted before enrollment.

Under the ACA changes in effect now they are static until 2026, but the last year they were adjusted was for 2021, and that occurred in July of 2020. Of course, that was lowered in March of 2021 by the American Rescue Plan Act of 2021 so it never was actually used.

 

[scrabbler1]

After reading all of your replies (and thanks for all the good discussion), I see I can back into the SLCSP used to determine my APTC subsidy.

I went back to the confirmation letter I received from my state's (NY) exchange to remind me of the estimated MAGI I reported to them a year ago (I needed to show proof again due to a technical reason, but that did not affect my ATPC subsidy, nor was it different for January versus subsequent months).

I plugged the estimated income I reported into a spreadsheet which mimics the calculations shown on Form 8962, along with the appropriate FPL. When I included the SLCSP amount I received a few days ago, the actual and calculated subsidies were nearly identical, about $2 apart, as SecondCor521 suggested.

This means, as Cathy63 suggested, I can do for next time, by trial and error, enter the MAGI and FPL amounts (are the FPLs published somewhere in advance?) into my spreadsheet, then the APTC amount. I can then enter different SLCSP amounts to see which one gets me to a zero difference between the actual APTC and the calculated one. This does assume that the %-of-MAGI figure from that big table (Table 2) changes little or not al all from the prior year. Some years, it changed a little. It remained unchanged from 2021 to 2022.

This will, at least, greatly reduce any unpleasant surprise I see with the SLCSP, as it is known by my state's exchange at the start of the year even though their phone reps have no idea what it is.

Thanks to you all for an educational discussion which will help me going forward. I can build this into my 2023 tax spreadsheet.

I just received Form 1095-A for 2023. Let's see how the trial-and-error method I learned (with your help) did.

As I posted a year ago, I entered into my Form 8962 spreadsheet the MAGI I gave to my state's exchange and the updated FPL ($13,590 for a single filer in the lower 48 states) for 2023 (which I know is one year behind the actual). I eventually arrived at a SLCSP amount which gave me a net subsidy of within a few dollars of the actual subsidy I have been receiving.

But on the actual 1095-A form, the SLCSP isn't anywhere near the calculated amount from my spreadsheet. It is higher, much higher, by ~$77 per month, or $919 for the year. This not only pays my 2023 tax bill but will give me a refund of just over $300.

While I am delighted at this turn of events, I am also puzzled as to why this method of trying to figure out the SCLSP failed so miserably. Did the state use a different MAGI amount? I doubt it. First, they told me what they would be using. Even if they used recent income data reported on a recent year's state income tax return, it wouldn't have changed anything too much because my MAGI has been pretty stable since 2020. In fact, they would have had to use a MAGI much, much higher (not lower) to get my subsidy calculation to come out right.

This whole thing may end up moot next time because the state increased its income limit to become eligible for the NY Essential Plan (effective in a few months, I have learned), and my income is in the range of the expansion interval. So, I am not overly interested in figuring out what happened but I will be delighted to continue this discussion anyway.

 

[jim584672]

The 2023 NY SLCSP table for 2023 doesn't have any over $771 for an Individual. Strange that your number is so high.

https://info.nystateofhealth.ny.gov/sites/default/files/English%20-%202023%20SLCSP%20Chart.pdf

 

[SecondCor521]

I just received Form 1095-A for 2023. Let's see how the trial-and-error method I learned (with your help) did.

As I posted a year ago, I entered into my Form 8962 spreadsheet the MAGI I gave to my state's exchange and the updated FPL ($13,590 for a single filer in the lower 48 states) for 2023 (which I know is one year behind the actual). I eventually arrived at a SLCSP amount which gave me a net subsidy of within a few dollars of the actual subsidy I have been receiving.

But on the actual 1095-A form, the SLCSP isn't anywhere near the calculated amount from my spreadsheet. It is higher, much higher, by ~$77 per month, or $919 for the year. This not only pays my 2023 tax bill but will give me a refund of just over $300.

While I am delighted at this turn of events, I am also puzzled as to why this method of trying to figure out the SCLSP failed so miserably. Did the state use a different MAGI amount? I doubt it. First, they told me what they would be using. Even if they used recent income data reported on a recent year's state income tax return, it wouldn't have changed anything too much because my MAGI has been pretty stable since 2020. In fact, they would have had to use a MAGI much, much higher (not lower) to get my subsidy calculation to come out right.

This whole thing may end up moot next time because the state increased its income limit to become eligible for the NY Essential Plan (effective in a few months, I have learned), and my income is in the range of the expansion interval. So, I am not overly interested in figuring out what happened but I will be delighted to continue this discussion anyway.

Are the SLCSP entries the same for each month? That could provide a clue.

It's unlikely, but there could be information on your ACA application for 2023 which isn't accurate. You've been on ACA for at least two years, so it should just carry forward, but sometime the change backend systems and do data imports or all sorts of weird things. Maybe that messed up your age or zip code, which would affect the SLCSP.

The other possibility I can imagine is that the SLCSP changed because any of the following happened:

1. You moved within your state,
2. The lowest Silver plan went away.
3. The second lowest Silver plan went away.

The state *should* have adjusted things automagically for you, but maybe they screwed up.

Even if you can't reverse engineer it, you should at least be able to call your state Marketplace and have them confirm all of your data and explain where they got the SLCSP number. This is necessarily so because sometimes 1095-As are wrong (which is yet another possibility in your scenario) and calling is the only way to get the right information after the 1095-A is sent.

 

[jim584672]

The SLCSP in NY is uniform by county because there is no age rating so it MUST be on the table I posted (assuming no error in the table).

 

[scrabbler1]

The 2023 NY SLCSP table for 2023 doesn't have any over $771 for an Individual. Strange that your number is so high.

https://info.nystateofhealth.ny.gov/sites/default/files/English%20-%202023%20SLCSP%20Chart.pdf

My county (Nassau) has a SLCSP of $661, the same or very nearly the same as neighboring Suffolk, Queens, and the other 4 counties of New York City. I doubt very much the NYSOH made a mistake.

 

[scrabbler1]

Are the SLCSP entries the same for each month? That could provide a clue.

It's unlikely, but there could be information on your ACA application for 2023 which isn't accurate. You've been on ACA for at least two years, so it should just carry forward, but sometime the change backend systems and do data imports or all sorts of weird things. Maybe that messed up your age or zip code, which would affect the SLCSP.

The other possibility I can imagine is that the SLCSP changed because any of the following happened:

1. You moved within your state,
2. The lowest Silver plan went away.
3. The second lowest Silver plan went away.

The state *should* have adjusted things automagically for you, but maybe they screwed up.

Even if you can't reverse engineer it, you should at least be able to call your state Marketplace and have them confirm all of your data and explain where they got the SLCSP number. This is necessarily so because sometimes 1095-As are wrong (which is yet another possibility in your scenario) and calling is the only way to get the right information after the 1095-A is sent.

The SLCSP entries are the same for all 12 months. I didn't move within the state. I wouldn't know if the lowest of second lowest Silver plans went away. I think if there was an error made, it was made a year ago when the NYSOH determined my monthly subsidy.

I should also add that for 2024, the calculated SLCSP using our allegedly correct method is $781, nearly $200 more than the erroneous (calculated) SLCSP I entered in my spreadsheet a year ago, but only $121 more than the actual SLCSP shown on the 2023 1095-A form. This suggests that whatever problem there was a year ago may not be occurring this time.

I'll use the data shown in the actual 1095-A form when completing my tax forms. Calling the NYSOH is usually a PITA and those reps don't know much of anything. The reps who answer the special hotline for 1095-A issues are better. But what will they tell me, the data on the form is correct?

 

[SecondCor521]

I'll use the data shown in the actual 1095-A form when completing my tax forms. Calling the NYSOH is usually a PITA and those reps don't know much of anything. The reps who answer the special hotline for 1095-A issues are better. But what will they tell me, the data on the form is correct?

Personally I'd just use the data on the 1095-A as is as long as it looked reasonable to me.

If I was extra bored or curious or upset, I'd call them, sit on the line with them, ask for a supervisor, get someone who knew what I was actually talking about and sounded competent, then have them go over all of the relevant data to confirm it was accurate in their system (age, zip code, covered members, etc.), and then ask them to give me the first and second lowest cost Silver plans premiums and see if there were any variances between that information and what was displayed on the "choose plans" portion of the ACA website.

But I lost my enthusiasm just typing that previous paragraph, so I can totally understand anyone not wanting to go through that. It's not a very appealing option.

 

[jim584672]

Personally I'd just use the data on the 1095-A as is as long as it looked reasonable to me.

I agree, they provided the document so use it as is.