ACA Subsidies: Pregnancy During Open Enrollment

[CanuckExpat]

How does one handles being pregnant during ACA open enrollment period, and what options are available?

i.e. if a woman is pregnant during 2016 open enrollment and expecting 2017, would she enter information only for current household size, not the current + 1 and then re-sign up for healthcare after birth (life event)? Having an extra family member but same income seems like it could affect subsidy and cost sharing eligibility a lot, not sure how one factors that into planning.

Follow up, being pregnant seems to greatly increase the income levels at which a woman is eligible for medicaid. If you are eligible for medicaid you lose ACA subsidies right? This also seems to create situation where pregnant family member would be medicaid eligible, but non-pregnant adults in family are not. If one wanted to avoid medicaid for any reason, do you have to disclose the pregnancy, and at what point (ie are you not pregnant until a certain date, until confirmed by a medical professional, etc)?

[Paul der Krake]

I can't imagine how they could prove, or even want to prove, that you hid a pregnancy.

If you answer questions truthfully and check the "pregnant" checkbox on healthcare.gov (previewing the plans, not an actual application), does it tell you something different than if you don't?

[CanuckExpat]

If you answer questions truthfully and check the "pregnant" checkbox on healthcare.gov (previewing the plans, not an actual application), does it tell you something different than if you don't?

Yes. Using FL as example, family of three, with $25,000 income.

First scenario, nobody pregnant:
Person #1 (age 33) may be eligible for a premium tax credit that lowers the monthly costs of health insurance.
Person #2 (age 34) may be eligible for a premium tax credit that lowers the monthly costs of health insurance.
Person #3 (age 2) may be eligible for coverage through Medicaid or the Children's Health Insurance Program (CHIP).
Based on the information you provided, it looks like your household qualifies for a premium tax credit of $556 per month

Second scenario, Person #2 pregnant, all esle same:
Person #1 (age 33) may be eligible for a premium tax credit that lowers the monthly costs of health insurance.
Person #2 (age 34) may be eligible for coverage through Medicaid or the Children's Health Insurance Program (CHIP).
Person #3 (age 2) may be eligible for coverage through Medicaid or the Children's Health Insurance Program (CHIP).
Based on the information you provided, it looks like your household qualifies for a premium tax credit of $255 per month

In scenario 2, it proceeds to only show health plans with coverage for Person #1.

[seattlecyclone]

Very interesting question.

I searched around for any articles about whether disclosing a pregnancy was mandatory, but couldn't find anything definitive. I did see a couple of sources (including the IRS) confirm that eligibility for non-marketplace heath programs such as Medicaid does disqualify that individual from getting a subsidy through the Marketplace. The key criterion is eligibility for Medicaid, not actual enrollment in the program.

My guess is that it would be your choice to enroll in Medicaid or not, to disclose the pregnancy or not. Nobody is making you do any of those things. However if you wish to claim the premium tax credit, you'll be declaring under penalty of perjury that you were in fact eligible for that tax credit. As one of the requirements for the tax credit is that you be ineligible for Medicaid, you would not be allowed to claim the tax credit.

[CanuckExpat]

My guess is that it would be your choice to enroll in Medicaid or not, to disclose the pregnancy or not. Nobody is making you do any of those things. However if you wish to claim the premium tax credit, you'll be declaring under penalty of perjury that you were in fact eligible for that tax credit. As one of the requirements for the tax credit is that you be ineligible for Medicaid, you would not be allowed to claim the tax credit.

That is a reasonable interpretation. As to the perjury point, it gets to the wierd question of when you should consider yourself pregnant (which is normally a pretty binary thing). There's a whole spectrum of time between unprotected sex, to 1 day late period, to home testing, to lab test in doctors office, to ultrasound confirming baby, etc...

Obviously you are pregnant nonetheless, but does the act of getting it confirmed by a doctor during open enrollment negate your eligibility for subsidy, where as it wouldn't if you had hit submit before seeing a doctor? It's a bit of an odd question, that I feel is mostly up to personal interpreation. I'm somewhat curious if the IRS would even bother to have guidance on the issue, what it would be..

[teen persuasion]

Not quite relevant to your question, but interesting in that it shows a bit of a window on how pregnancy is viewed by ACA rules:  by accident I stumbled across an interesting tidbit about NY adding pregnancy as a qualifying event.  Apparently per the ACA, pregnancy is not a qualifying event, but childbirth is.  NY opted to add pregnancy as a qualifying event (first state in nation), on the premise that prenatal care was important to good infant outcomes.  It was mentioned that with the ACA it had been debated whether to include pregnancy as a qualifying event, but it wasn't included.  They (NY) were defining eligibility based on the first of the month in which a medical provider confirmed the pregnancy.

https://www.healthinsurance.org/new_york-state-health-insurance-exchange/

Next question: at the end of 2017, when your family size is +1, what will your calculated credits look like on your tax return?  That's when everything is reconciled, ultimately.  I have no idea how it works when someone is added mid-year - is everything prorated by months, or ??

[rahaparta]

Here is how one couple handled it.

They enrolled normal during open enrollment and after child was born some 7 or 8 months later they updated their profile on Healthcare.Gov to show the +1 to their household size.

No significant penalty or change to their remaining months of subsidy occurred.

[CanuckExpat]

Not quite relevant to your question, but interesting in that it shows a bit of a window on how pregnancy is viewed by ACA rules:  by accident I stumbled across an interesting tidbit about NY adding pregnancy as a qualifying event.  Apparently per the ACA, pregnancy is not a qualifying event, but childbirth is.  NY opted to add pregnancy as a qualifying event (first state in nation), on the premise that prenatal care was important to good infant outcomes.  It was mentioned that with the ACA it had been debated whether to include pregnancy as a qualifying event, but it wasn't included.  They (NY) were defining eligibility based on the first of the month in which a medical provider confirmed the pregnancy.

https://www.healthinsurance.org/new_york-state-health-insurance-exchange/

That is interesting, even if it doesn't directly answer the question. In NY state, for the purpose of a life event, pregnancy is essentially "effective date of the first of the month in which her pregnancy is confirmed by a licensed healthcare provider.".

I suppose the gist of my question regarding pregnant or not for Medicaid/ACA subsidies gets to what is the equivilent federal definition, if there is one. Now that I think about it, it may actually turn out to be state-by-state based on the local Medicaid eligibility rules  with the Federal government only caring whether your local states counts you as Medicaid eligible, which if they do, then no premium tax subsidies.

Side point from that article that I thought was kind of interesting was the discussion about both the advantages and why it might be a bad idea to include pregnancy as a life event:
"Advocates have cheered the new legislation in New York, noting that pre-natal care increases the odds of a healthy, full-term pregnancy, and that unintended pregnancies necessitate the option to enroll in health coverage when a pregnancy is confirmed. But there are also concerns that this “loophole” in the enrollment system could result in adverse selection and higher premiums, since women will be able to wait until they’re pregnant – and in need of healthcare – to enroll in coverage.

Next question: at the end of 2017, when your family size is +1, what will your calculated credits look like on your tax return?  That's when everything is reconciled, ultimately.  I have no idea how it works when someone is added mid-year - is everything prorated by months, or ??

Yes, I'm not too worried about tax credits, since that will be reconciled at tax time based on end of year income and family size I assume. Where I think it gets interesting is the cost sharing reduction, which is based on family size and income, but can not be reconciled at tax time.

Our personal situation is specific enough that I'll leave out the details so as not to confuse this thread and hope it can serve as a useful general reference for anyone else in a similar situation. Still no definate answer, but good things to consider.

[Bracken_Joy]

Following, very interesting, and if all goes right could be a conundrum we face soon.

[redrocker]

How does one handles being pregnant during ACA open enrollment period, and what options are available?

i.e. if a woman is pregnant during 2016 open enrollment and expecting 2017, would she enter information only for current household size, not the current + 1 and then re-sign up for healthcare after birth (life event)? Having an extra family member but same income seems like it could affect subsidy and cost sharing eligibility a lot, not sure how one factors that into planning.

Follow up, being pregnant seems to greatly increase the income levels at which a woman is eligible for medicaid. If you are eligible for medicaid you lose ACA subsidies right? This also seems to create situation where pregnant family member would be medicaid eligible, but non-pregnant adults in family are not. If one wanted to avoid medicaid for any reason, do you have to disclose the pregnancy, and at what point (ie are you not pregnant until a certain date, until confirmed by a medical professional, etc)?

I went through exactly this in 2016. Let me just state up front that this might vary from state to state (I'm in Louisiana).
You've probably already figured out that with an expectant mother you don't claim the future dependent on the Marketplace application. Any and every Marketplace form you fill out *until* the baby is born you're supposed to exclude them in the household.

As for whether to report the pregnancy, you've already figured out the impact on the mother potentially getting pushed to Medicaid. It happened to me when I updated my income mid way thru the year and clicked "yes" on my wife being pregnant. I posted a panicked call for help on this very forum: http://forum.mrmoneymustache.com/ask-a-mustachian/healthcare-marketplace-confusion-now-spouse-is-being-pushed-to-medicaid/msg1227566/#msg1227566

They kept me on ACA and put her on Medicaid. Oddly enough, when we applied for Medicaid she didn't qualify and once that was denied the Marketplace put her back on an ACA plan. Not fun and frustrating.
I've since been told that you don't have to disclose pregnancy. And if I had to do it over again I probably wouldn't. Bear in mind that having the expectant mother on Medicaid almost certainly means you'll pay less (probably a lot less). You just have less choices in the care provider. My wife and her friend were due the same month. Her friend had the exact same situation with getting pushed to Medicaid and she did qualify for the Medicaid plan. Her friend gave birth at the same hospital as my wife, C-section procedure actually. She paid $0. We were on the hook for $2700 deductible plus at least $1100 more and the bills haven't stopped yet.

Final advice from my experience this year: I don't know your income situation but if you have flexibility (ie with timing withdrawals, increasing IRA deductions, etc) check with the Marketplace estimate tool to see what your deductible looks before and after adding your new family member. In hindsight, in *my* personal circumstance, I should have underestimated my income for the year slightly when applying, as I was just a few thousand from my individual deductible getting dropped to $500. When going to report a life change (new family member) I could then adjust my income to be what I expected/desired for the year. By the time I realized this (~5 weeks before the due date) it was too late to get my insurance policy updated for the lower deductible. But of course, after the birth, at the same income I qualify for the lower deductible. Of course, the only thing they consider when they close out the year is how many people are in your household on Dec 31 and the MAGI on your tax return. I learned that while the premium subsidies can be retroactive after filing your taxes for the year, the cost-sharing is not retroactive A little planning on my part and I'd have saved a good $4 grand or so.

[Paul der Krake]

Side question: what would be the reason to want to avoid Medicaid?

[CanuckExpat]

Side question: what would be the reason to want to avoid Medicaid?

In our case, the advantage of avoiding Medicaid would be because we would like an ACA plan with out of state network providers. Medicaid would only cover/reimburse out of state care for an emergency, and apparently even that is sometimes tricky in practice.

A smaller reason: I investigated enrolling / getting information on California's medicaid, and I found the process a bit unfriendly, unwieldy, and bureaucratic, so at the time we went with our backup private insurance option (much quicker, no paperwork or approval needed). I wouldn't necessarily generalize from that experience, but it does weigh on my mind.

Given those two things, Medicaid is still an option we are considering, and can make "our income" low enough to qualify with or without pregnancy. I wanted to go in with all my options, knowing whether we could rule out Medicaid if we wanted, or whether pregnancy would essentially dictate either Medicaid or no ACA subsidies (at a given income level).

Edited to fix typos

[Paul der Krake]

Side question: what would be the reason to want to avoid Medicaid?

In our case, the advantage of avoiding Medicaid would be because we would like an ACA plan with out of state network providers. Medicaid would only cover/reimburse out of state care for an emergency, and apparenrtly even that is sometimes tricky in practice.

A smaller reason: I investigated enrolling / getting information on California's medicaid, and I found the process a bit unfriendly, unwieldy, and beauracratic, so at the time we went withour backup private insurance option (much quicker, no paperwork or approval needed). I wouldn't neccesarrily generalzie from that experience, but it does weigh on my mind.

Given those two things, Medicaid is still an option we are considering, and came make "our income" low enough to qualify. I wanted to go in with all my options, knowing whether we could rule out Medicaid if we wanted, or whether pregnancy would essentially dictate either Medicaid or no ACA subsidies (at a given income level).

Cool, thanks for answering. Something to keep in mind if you spend a lot of time traveling, for sure.

[CanuckExpat]

I went through exactly this in 2016. Let me just state up front that this might vary from state to state (I'm in Louisiana).
...
They kept me on ACA and put her on Medicaid. Oddly enough, when we applied for Medicaid she didn't qualify and once that was denied the Marketplace put her back on an ACA plan. Not fun and frustrating.
I've since been told that you don't have to disclose pregnancy. And if I had to do it over again I probably wouldn't...

Thanks for sharing your experience, your latter point about not fun and frustrating gets to part of the reason I am curious about being able to omit checking the "pregnant" checkbox. Do you have more detail on being told that you do not have to disclose pregnancy?

[CanuckExpat]

Cool, thanks for answering. Something to keep in mind if you spend a lot of time traveling, for sure.

Our situation is quite specific, instead of cluttering up this thread with the nitty gritty, I did create a case study if anyone wants to kindly provide input on a very particular case of this general problem

[redrocker]

Do you have more detail on being told that you do not have to disclose pregnancy?

I'm sorry, I don't. I've heard it twice from individuals, one of whom is quoted in the thread I posted above. I've since done some web searching and haven't found conclusive proof that that's true.

[jim555]

Pregnancy is a life event and needs to be reported. 

[redrocker]

Pregnancy is a life event and needs to be reported.

Can you point me to where it says explicitly that pregnancy is a life event?

I noticed that pregnancy is not listed under qualifying life events on the Healthcare.gov site:
https://www.healthcare.gov/glossary/qualifying-life-event/

It also seems inconsistent that when you're filling out a Marketplace application and it asks you if you will claim dependents on that year's taxes, you're supposed to omit any expected children until they're born.

[jim555]

https://www.healthcare.gov/blog/7-things-to-know-about-reporting-a-life-change/
"You should report the following changes to the Marketplace:

    Changes in income or other changes that affect your household size.
    Marriage or divorce, pregnancy, having a child, adoption/placing a child for adoption, gaining/losing a dependent, or moving."

http://info.nystateofhealth.ny.gov/sites/default/files/Essential%20Plan,%2010-7-15.pdf
"Pregnant women are NOT eligible for Essential Plan because they will qualify for Medicaid.  Consumers are required to report their pregnancy and the NY State of Health will re-determine their eligibility for Medicaid."

[redrocker]

Thanks, Jim.
Following your first link takes you to a different page than the one I posted also listing life changes to report. For some reason pregnancy wasn't included on my prior link but it is on this one.
https://www.healthcare.gov/reporting-changes/which-changes-to-report/

[MustardTiger]

Once you have your baby, you have a one month open enrollment period where you will change your family size and be able to change plans if you choose.