ACA subsidies eligibility, CHIP, varied income

[JJ-]

I am looking to optimize health insurance for our family of 4 (38, 35, 5, 3) after leaving a job with health insurance. Our HHI will be likely somewhere in the 250-270%FPL range but we can make it higher or lower as needed (+/- 50% FPL).

We live in Colorado and 260% FPL is the threshold for CHIP eligibility. DW has employer sponsored coverage that is affordable for her but not for the rest of the family (glad family glitch is fixed).

We are not opposed to having kids on CHIP as their primary care physician is in network for their plans. DW would be on her employer coverage and I would likely be on a marketplace plan, with or without kids depending on how the mechanics of the PTCs work. I understand that if they're eligible for CHIP they're ineligible for PTC subsidies.

Based on the nature of my old job payouts and DW winding down contract work, our monthly income will greatly exceed the monthly CHIP income thresholds in February and March, maybe even April. This cash would float the rest of our expenses throughout the rest of the year.

This scenario would have me+kids on a marketplace plan with subsidies for just a few months. Then when the income winds down the kids could go on CHIP and I would stay on a marketplace plan. Though strangely the monthly premiums go up for just me as opposed to all 3 of us on any given plan. Not so much that it would make sense to keep kids on the marketplace plan, but enough that it would be slightly beneficial to put them onto CHIP.

My question comes down to how do the subsidies work for the PTC when you have a portion of your household eligible for only a few months? I was looking at the worksheet and it seems to me like it's on a monthly basis for the PTC, essentially what's your premium vs what's your credit based on that month, but I'm not sure.

I wanted to validate this assumption before committing to having them on a marketplace plan for a few months and then off, expecting a PTC.

The alternative to have them immediately eligible for CHIP would be to increase 401k and solo 401k traditional contributions for the next few months and then pull out funds from taxable/Roth/I bonds to cover expenses as needed throughout the year. That's a bit more complicated, so my preference is for the first option if PTCs are month to month depending on an individual's eligibility.

Thoughts?

[jim555]

It is possible to have some months in Medicaid and others in PTC plans.  When I retired my UI put me in PTC plans for half a year.  UI stopped and I dropped into Medicaid.  The PTC recon at tax time is for those months you are in PTC plans.

CHIP in CO has a 12 month lock in, so once you qualify for a month they lock it in for a year.  That means income could go up and not lose coverage as long as it comes back down for the annual redetermination month.

The new FPL levels came out last week so the Medicaid numbers will go up shortly by 7.28%.  ACA PTC uses the 2022 FPL for year 2023, it is always a year behind.

[JJ-]

It is possible to have some months in Medicaid and others in PTC plans.  When I retired my UI put me in PTC plans for half a year.  UI stopped and I dropped into Medicaid.  The PTC recon at tax time is for those months you are in PTC plans.

CHIP in CO has a 12 month lock in, so once you qualify for a month they lock it in for a year.  That means income could go up and not lose coverage as long as it comes back down for the annual redetermination month.

The new FPL levels came out last week so the Medicaid numbers will go up shortly by 7.28%.  ACA PTC uses the 2022 FPL for year 2023, it is always a year behind.

Thanks for your experience. I noticed the 12 month lock in for the pregnant women but not for kids. I went back and read it and found it. It's incredibly relieving to see that it's not month by month for continued eligibility.

I do have an appointment scheduled with one of their certified assisters to help with these more "complicated" scenarios. But it seems like the plan to do a marketplace plan then swap to CHP when eligible seems the simplest approach and valid.