How to Apply for Individual Health Insurance?

[reubenray]

It was suggested on another thread that we (wife and myself) get individual policies being I will be turning 65 next September. I found a better and cheaper policy by doing this. Now a few questions.

1) We file our taxes jointly so will that be an issue?

2) I was told to simply split our income in half for the income question. Is this correct?

3) The policy I am looking at is a Cost-Sharing plan in Alabama. Will this affect anything?

 

[rodi]

You will need to purchase through an exchange. Does Alabama have it's own exchange or are you using Healthcare.gov?

(And another question - do you live in Alabama yet? your profile suggests LA. You need to be a legal resident of the state you purchase insurance in.)

My understanding of how it works on Healthcare.gov is you put the HOUSEHOLD income and both parties... you go through the entire eligibility process... then you are allowed to create "groups" - you'd put yourself in one group, and your wife in a different group. Once you have your groups - you select insurance for each group.

I haven't done this on healthcare.gov - but I've heard it works that way. My state has it's own exchange and has it's own special quirks.

 

[reubenray]

You will need to purchase through an exchange. Does Alabama have it's own exchange or are you using Healthcare.gov?

Alabama has its on exchange

(And another question - do you live in Alabama yet? your profile suggests LA. You need to be a legal resident of the state you purchase insurance in.)

We will be moving there next month

My understanding of how it works on Healthcare.gov is you put the HOUSEHOLD income and both parties... you go through the entire eligibility process... then you are allowed to create "groups" - you'd put yourself in one group, and your wife in a different group. Once you have your groups - you select insurance for each group.

I haven't done this on healthcare.gov - but I've heard it works that way. My state has it's own exchange and has it's own special quirks.

See answers in bold to your questions.

 

[AllDone]

Alabama uses the federal exchange.

You can buy your insurance through a broker rather than the exchange, if you prefer.

 

[rbmrtn]

AL uses the federal exchange ( healthcare.gov )

 

[reubenray]

OK - I need to more research.

If I halved the income before and then do a search I come across cost saving options. If I search for a family plan it does not offer any cost saving options. The plans are identical, but one is cost saving and one is not.

Would it switch to a cost saving option when I divide us into two groups? I am using Healthsherpa for researching.

https://www.ibcbsal.com/sbc/2016sms-87.pdf

https://www.ibcbsal.com/sbc/2016sms.pdf

 

[Nunthewiser]

My understanding of how it works on Healthcare.gov is you put the HOUSEHOLD income and both parties... you go through the entire eligibility process... then you are allowed to create "groups" - you'd put yourself in one group, and your wife in a different group. Once you have your groups - you select insurance for each group.

Rodi is exactly right....I just did this yesterday.

Keep your income together. Just follow the healthcare.gov prompts, step by step...and split into 2 groups after the income section is done.

 

[rodi]

reubenray - google is your friend. I looked up the income thresholds for Alabama for a family of 2. Here's what I got:

Estimated 2016 household income: Savings programs you qualify for:
Below $15,930
Since your state hasn't expanded Medicaid, you won't qualify for Medicaid based on your income alone. You also won't qualify for savings on a Marketplace insurance plan. Next steps.

$15,930 - $39,825
You'll qualify for a Marketplace health plan with lower monthly premiums plus savings on out-of-pocket costs, like deductibles and copayments. Next steps.

$39,826 - $63,720
You'll qualify for a Marketplace health plan with lower monthly premiums. Next steps.

Above $63,720
You won't qualify for savings on a Marketplace insurance plan. You can buy insurance through the Marketplace at full price, or buy from other sources.

(I added bolding and line returns to make the c/p more readable.)
https://www.healthcare.gov/lower-costs/qualifying-for-lower-costs/

 

[reubenray]

reubenray - google is your friend. I looked up the income thresholds for Alabama for a family of 2. Here's what I got:


(I added bolding and line returns to make the c/p more readable.)
https://www.healthcare.gov/lower-costs/qualifying-for-lower-costs/

We are in the third category ($39,826 - $63,720).

 

[rodi]

Then you should be good to go. It looks like Alabama *is* using healthcare.gov rather than their own exchange... (as previous posters have also mentioned. ) So it should work as I described above - and the premium tax credits should be applied.

 

[sengsational]

I can confirm that, on the federal exchange at least, you put in the whole thing. No halvsies.

The income you put on the application is for your whole family as defined by your future 1040. Your family is also defined there (you, spouse, dependents).

Then you buy insurance for whoever you want (not necessarily all members of the family). I imagine that it will "see" that one of your family will become medicare eligible and prorate your estimated tax credit. So, for instance, if nobody was going to turn 65, you might get a PTC of $1000/mo. But if you will have 12 months and spouse will only have 6 months due to turning 65, it will only give you $750.

 

[MBSC]

I imagine that it will "see" that one of your family will become medicare eligible and prorate your estimated tax credit. So, for instance, if nobody was going to turn 65, you might get a PTC of $1000/mo. But if you will have 12 months and spouse will only have 6 months due to turning 65, it will only give you $750.

The exchange does not make assumptions.

If you have a Marketplace plan, you can keep it until your Medicare coverage starts. Then, you can cancel the Marketplace plan without penalty.

Canceling your Marketplace plan
My spouse and I are both enrolled in the same Marketplace plan, but only my spouse needs to cancel due to getting Medicare. You’ll keep the Marketplace coverage for yourself and end Marketplace coverage only for your spouse.

More info: https://www.healthcare.gov/medicare/changing-from-marketplace-to-medicare/

 

[reubenray]

I was surprised that a difference of $4,000 would change the BCBSAL silver plan so much. The plan is identical except for what we have to pay is more than if we made $4,000 less. Not only the premiums are more, but the cost for doctor visits, etc. is more to.

Last year my estimated earnings was less than what I posted and we got back some money on the federal tax. I would be concerned of what the penalty would be if you underestimated the earnings.