Sorry for the confusion! Im still trying to understand how everything works and would love to know more. Capital gains, dividends, and Roth conversions do apply if taken monthly. If taken as a 1 time transaction, they only apply for that month. The confusion arises because Medicaid is calculated monthly, not yearly.
From the WA state legislature, "Any income received as a lump sum as described in WAC 182-509-0375 is counted as income only in the month in which it is received."
Exchange eligibility is based on yearly income. It's fairly easy to calculate as its just your MAGI. This means you can apparently be eligible for both, but you are given the option that would benefit you the most. This is also why you are supposed to report income changes greater than $150.
I am trying to understand these differences so I know how to answer the questions to avoid medicare, but still get a subsidy. Although in my state, you could make close to $100,000 per month and the kids could still be on Medicaid with a $30/child/mo (max of $60/family) premium (Family of 4 maxing out 401k and tiras).
I could not figure out how to document our income this year since we have foreign income, WA state income, a 2 month "sebatical", and then a "normal" work schedule for 4 or 5 months of the year. I finally gave up and called them. The minute I said unemployed when we move back, the deal was done. Our income for those months might approach $1,000, but that is still significantly under the cut-off.
I spoke to a friend whose children have been on Medicaid for 6 yrs and she loves it, so I am feeling better about it after asking a lot of questions. Which is good because the kids at least will be on it until the end of the year.