ACA Family Glitch

[wageslave23]

I'm going to retire soon but my spouse will keep working part time.  She qualifies for "affordable" healthcare coverage through her employer.  Its about $300 a month for her which is less than 9% of household income.  But if we add our family to her coverage, it would go up to $1000 a month, which would be about 26% of household income.  According to my research, we are disqualified from ACA subsidies because her employee only premium is "affordable".  Is there anything I'm missing?  Seems like this is a major "glitch".  I can't believe it hasn't gotten more press. 

[seattlecyclone]

You're missing nothing. Sorry to hear you got caught up in this. Will your income be low enough for your kids to qualify for Medicaid/CHIP coverage in your state? That could reduce your cost a bit.

[Paul der Krake]

Can your wife negotiate a custom part-time work contract that disqualifies her from the coverage?

For example if the cutoff for benefits is 20 hours a week, work 19 hours. Or become a contractor.

[wageslave23]

That sucks.  She'll need to check if she can switch to a different position.  I guess it's good that I realized this now.  Barely makes sense for her to keep working. I feel sorry for the people that don't have options like we do. I would think a lot of lower/middle income families fall into this gap.

[Sibley]

There was a lot of press coverage about this type of thing, but it was years ago when ACA first came out. You just don't remember it. I do, vaguely, because I was working in the health insurance industry so I followed it more.

The ACA, while it did a lot of good, is also deeply flawed. This is one of those flaws. I'm sorry that you got caught in it. Ironically, she might be better off with a part time job that doesn't have benefits. Good luck figuring things out. You might have some success in internet searches to see if there are creative workarounds (just stay on the side of legal!).

[wageslave23]

There was a lot of press coverage about this type of thing, but it was years ago when ACA first came out. You just don't remember it. I do, vaguely, because I was working in the health insurance industry so I followed it more.

The ACA, while it did a lot of good, is also deeply flawed. This is one of those flaws. I'm sorry that you got caught in it. Ironically, she might be better off with a part time job that doesn't have benefits. Good luck figuring things out. You might have some success in internet searches to see if there are creative workarounds (just stay on the side of legal!).

Yeah I probably didn't pay attention to it since it didn't apply to me.  That's no excuse but probably the reason.

[jpdx]

Can Congress fix the glitch via Budget Reconciliation, and, if so, are there any plans to do so right now?

[Sibley]

Can Congress fix the glitch via Budget Reconciliation, and, if so, are there any plans to do so right now?

It's been out since 2010, they haven't fixed it yet, they're not going to. Your best bet for a fix is Medicare for All or similar. I'm waiting for pigs to learn to fly though.

[Paul der Krake]

There were some rumors earlier in the year that it might get fixed with a roundabout way but nothing since:
https://acasignups.net/21/04/05/good-news-biden-admin-may-fix-familyglitch-regulation-after-all

It might make its way through one of the super bills making their way through Congress right now. On its face it wouldn't be eligible for budget reconciliation since it would amount to new spending, but I cannot tell what qualifies as new spending and what doesn't these days.

🤷

[fuzzy math]

Same issue here. If I quit, DH's insurance is under the 9% for him, but would be $1785 for all of us.

[frugalnacho]

We ran into this in 2017 when my employer was purchased by another company.  My insurance went from something like $60/check to $500/check.  Single person coverage was considered "affordable" but the company didn't cover anything additional for families (ie cost to the company was the same regardless of if you're single, or had a family, because they didn't absorb any of the increase in cost), therefore we weren't eligible for subsidies even though the cost of the family coverage was over 20% of my income.  Different situation than being partially FIRE, but sucked ass nonetheless because my choices were to:

1. pay full price for medical insurance for my family even though the cost was a burden and was way outside what is defined as "affordable" by the ACA

That's it, that was the only option. 

[KarefulKactus15]

Doesn't help but another huge glitch is not making enough money to get the subsidy in a state that didn't expand low income coverage.

[kanga1622]

Doesn't help but another huge glitch is not making enough money to get the subsidy in a state that didn't expand low income coverage.

YES! I am in one of the states that didn't expand Medicaid. But how the heck is a 26 year old graduate student supposed to pay $500 per month for the required health insurance (because of their graduate program) through ACA because they don't have enough income to qualify for a subsidy. But they also can't work enough to qualify for a subsidy due to a 40 hr per week clinical placement while studying for the required licensure exam.

I hear this a lot from students I work with.

[KarefulKactus15]

I haven't verified it since I pursued another option that was mentioned on MMM a while back....

What I believe some people do is they always estimate that they will earn the minimum amount.  Its an estimation and I imagine nobody intends or wants to earn less than 26k (or whatever the amount is).  The last I looked, there was no mechanism that forced a payback or correction of information if you did indeed earn too little to receive the subsidy. 

[Paul der Krake]

Doesn't help but another huge glitch is not making enough money to get the subsidy in a state that didn't expand low income coverage.

YES! I am in one of the states that didn't expand Medicaid. But how the heck is a 26 year old graduate student supposed to pay $500 per month for the required health insurance (because of their graduate program) through ACA because they don't have enough income to qualify for a subsidy. But they also can't work enough to qualify for a subsidy due to a 40 hr per week clinical placement while studying for the required licensure exam.

I hear this a lot from students I work with.

Don't grad students have cheap-ish insurance available through the university like undergrads?

[kanga1622]

Doesn't help but another huge glitch is not making enough money to get the subsidy in a state that didn't expand low income coverage.

YES! I am in one of the states that didn't expand Medicaid. But how the heck is a 26 year old graduate student supposed to pay $500 per month for the required health insurance (because of their graduate program) through ACA because they don't have enough income to qualify for a subsidy. But they also can't work enough to qualify for a subsidy due to a 40 hr per week clinical placement while studying for the required licensure exam.

I hear this a lot from students I work with.

Don't grad students have cheap-ish insurance available through the university like undergrads?

Nope. My college used to have insurance available but dropped all plans once ACA came on the scene. I believe they determined the pool left to buy coverage was too small with the expanded age for parental coverage and ACA options.