Get answers to frequently asked questions about the Affordable Care Act’s premium tax credits (subsidies).
Obamacare Subsidies: Frequently Asked Questions
1. QUESTION: How do government health insurance subsidies work?
Answer: The ACA provides government-funded subsidies to help reduce monthly health insurance premiums for qualifying persons. Consumers may qualify for subsidies if they have an annual household income between 133% and 400% of the federal poverty level (up to about $46,000 for a single person in the contiguous United States, or $95,000 for a family of four). The dollar value of the subsidies you receive will depend on where your income falls within that range and on the cost of “benchmark” health plans in your area. Since subsidies are based on your estimated income for the current year, the amount of subsidies you qualify for may fluctuate depending on changes to your actual income. Any discrepancies in the subsidies you received and the subsidies you were actually due are reconciled when you complete your federal tax return for the year.
2. QUESTION: If I enroll in a new plan during open enrollment, when can my coverage start?
Answer: The new open enrollment period is for 2015 health insurance plans only. During open enrollment, coverage under any new plan you select can begin no sooner than January 1, 2015, at the earliest.
3. QUESTION: I already have coverage. Am I required to apply for health insurance again during this open enrollment period?
Answer: You are not required to enroll in a new plan for 2015, unless your insurance company or licensed agent tells you otherwise, but reshopping during open enrollment – especially if you used a government subsidy in 2014 or may qualify for a subsidy in 2015 – could save you money, and you may find a new plan better suited to your personal coverage needs.
4. QUESTION: Am I going to lose my health insurance subsidies for 2015 if I don’t reshop during open enrollment?
Answer: The answer depends on your personal circumstances. When you first applied for a subsidy, did you give permission for your tax records to be accessed so that your subsidy could be automatically updated each year? If the answer is yes, and if your income hasn’t changed much and plan prices in your area do not change significantly, you’ll probably continue to receive the same subsidy as long as you remain in the same plan. If your income has increased to over 500% of the federal poverty level (about $58,000 for a single person in the contiguous United States, or $119,000 for a family of four) your subsidy will end after December 31, 2014 unless you re-apply for a one and enroll in a new plan for 2015. Likewise, if you received a subsidy in 2014 and did not give permission for your tax records to be accessed for the purposes of updating your subsidy, your subsidy will also end December 31, 2014, unless you re-enroll.
5. QUESTION: Make it easy for me. Who should shop for health insurance during open enrollment, and who shouldn’t?
Answer: Here’s a simple breakdown of who should shop or re-shop for health insurance during open enrollment, and who may not need to. Find the category that best describes your personal situation:
- “I am currently uninsured:” Don’t let open enrollment pass you by! This may be your only chance to get health insurance coverage for yourself and your family for 2015. You may even be eligible for subsidies to make your coverage more affordable.
- “I am no longer happy with my current health insurance plan:” Anyone no longer happy with their current health insurance plan should take advantage of open enrollment to look at their coverage options. There may be other plans that are better suited to your medical or financial needs or that cover the doctors and hospitals you prefer to see.
- “I am a subsidy recipient who gave permission for my tax information to be accessed but my income has changed:” When you completed your application last year you may have given permission for your tax information to be accessed for the purpose of updating your subsidy eligibility this year. If that’s the case, and if your income has changed, you should reshop and re-enroll in coverage during this open enrollment period. Depending on how your income changed, your subsidies may be scheduled to end after December 31, 2014 unless you take action. It’s also possible that you may be due more subsidies in 2015 than you are currently receiving.
- “I am a subsidy recipient who gave permission for my tax information to be accessed and my income has not changed:” If you’re happy with your current health insurance plan and don’t want to change, you may not need to take any action unless your insurance company or licensed agent informs you otherwise. However, it may still be a good idea to check out your options during open enrollment. For example, if the “benchmark” health insurance plan in your area has changed, it could alter the value of your subsidy in 2015.
- “I am a subsidy recipient who did not give permission for my tax information to be accessed in order to update my subsidies:” Your subsidies will end after December 31, 2014 unless you take action. If you believe you are still entitled to subsidies in 2015, you must reshop, apply for a subsidy again, and enroll in a plan for 2015.
- “I did not receive subsidies in 2014 but think I may qualify for them in 2015:” If you think you may be eligible for subsidies to help make your monthly premiums more affordable, take advantage of open enrollment to apply for subsidies and enroll in a plan for 2015.
- “I will not qualify for subsidies in 2015:” If you’re happy with your current plan, you shouldn’t need to take any action unless advised to do so by your health insurance company or licensed agent. However, there are new plans available in 2015 and it’s always a good idea to take a fresh look at your coverage options once per year. Unless you experience a qualifying life event (like a move, marriage, birth of a child, or other event) open enrollment may be your only chance to change your health plan for 2015.
6. QUESTION: Am I going to lose coverage under my current plan if I don’t reshop during open enrollment?
Answer: No, you should not lose coverage under your current ACA-compliant health insurance plan in 2015, unless your insurance company or licensed agent informs you otherwise. Here’s a possible exception: your insurance company may decide to stop offering your plan. If that happens, they will probably advise you of other plans you may wish to consider. You should also work with a licensed online agent like eHealth to review plans from multiple insurers and make sure you find the best match for your needs.
7. QUESTION: Last year I got my health insurance plan and subsidies through the online government exchange. Do I need to reshop through the government exchange again for 2015?
Answer: A lot of consumers expressed frustration with their experience of the government-run health insurance exchanges during the last open enrollment period. The good news is that you may have other options, even if you’re eligible for subsidies. Licensed private health insurance marketplaces like eHealth can help. At eHealth, consumers from most states can apply for subsidies and enroll in coverage in precisely the same health insurance plans available through their government exchange.
8. QUESTION: Why should I shop for my 2015 health insurance plan through eHealth rather than through the government exchange?
Answer: When you shop with eHealth during open enrollment you may benefit in the following ways:
- eHealth makes it simple to shop for coverage and enroll in the plan of your choice. With more than fifteen years of expertise, eHealth understands how consumers like you want to shop for health insurance. We’re always improving our website and shopping tools to make it easier – and faster – to find the coverage you need.
- eHealth offers a broader range of coverage options. The health insurance plans offered through government exchanges may only represent a fraction of the coverage choices available to you. You may have other options that will also meet your coverage requirements under the ACA and protect you from a tax penalty. eHealth is your best source for selection, representing over 200 brand-name insurers nationwide.
- eHealth may be able to help you apply for government subsidies. Subsidies are available for qualifying shoppers, depending on your income and other criteria. Subsidy-eligible consumers in most states can apply for government help through eHealth and then enroll in the very same health plans (at the same prices) that are offered through government exchanges.
- eHealth provides personal advice and ongoing advocacy. The customer service representatives available to help you at government exchanges aren’t usually licensed agents and probably can’t provide you with personal advice about your coverage choices. At eHealth, our unbiased, licensed agents make all the difference when it comes to your long-term satisfaction. Even after you enroll, eHealth can continue to serve as your advocate with the insurance company.
- eHealth is a total coverage marketplace. There’s more to “coverage” than just health insurance – which is what government exchanges are mostly limited to. By contrast, at eHealth you can also find dental and vision insurance, as well as products like short-term insurance, travel insurance, and accident or critical illness insurance. eHealth has all you need to craft a total coverage package for yourself or your family.
9. QUESTION: What happens if I miss the open enrollment period?
Answer: If you miss the ACA open enrollment period for 2015 you may run the risk of going uninsured – or being stuck in your current plan – for all of 2015. Outside of open enrollment, you may only be able to enroll in a major medical individual or family plan when you experience a qualifying life event such as marriage, the birth of a child, or a move to a new city or state. So don’t let open enrollment pass you by without taking a look at your eligibility for a subsidy and your coverage choices for 2015. You’ll be glad you did.
Tips For Shopping
Don’t miss out on open enrollment for 2015! Open enrollment only comes once a year. The 2015 open enrollment period begins on November 15, 2014 and continues through February 15, 2015. Coverage under new 2015 health insurance plans can start as soon as January 1, 2015. If you miss open enrollment, you may only be able to purchase coverage if you experience a qualifying life event – and you may face tax penalties if you remain uninsured for more than three consecutive months in 2015.
Find out if you qualify for a subsidy – One of the things that keeps people from buying health insurance is the cost, but many Americans will qualify for government subsidies to make their premiums more affordable. If you earn less than 400% of the federal poverty level (in 2014 about $46,000 for a single person or $95,000 for a family of four) you may qualify. Subsidies can be a big help, but be aware that if you earn more during the year than expected, you may have to pay back some or all of your subsidy dollars at tax time.
Shop for coverage at eHealth – As a federally certified web-broker licensed in every state, eHealth has a wide selection of qualified health plans that can be purchased at our site using a government subsidy, if you qualify. But, eHealth also has major medical health insurance plans available from brand-name insurance companies that are not available on government exchanges, at all. And, major medical health insurance plans protect you from the uninsured tax penalty. If you want to compare qualified health plans to major medical health plans, you’ll find both at eHealth.com!
Get personal help from a licensed agent – Understanding which plans are best for you and whether or not it’s smart to apply for government subsidies can be difficult. Thankfully professional, personal help is available. Licensed agents like those at eHealth can provide you with free, unbiased advice and help you enroll in the best health insurance plan that offers the best fit for your family’s medical needs and your budget.