Open enrollment for health insurance in the ACA marketplace for 2018 began on November 1, 2017 and ended on December 15, 2017, providing a shorter open enrollment than previous years. Although the standard enrollment period is over in mid December, there are still special circumstances where people can enroll throughout the year. This is called special enrollment.
If you can provide proof to a health insurer that you had a major life event such as being let go from your employment, getting married or having a child, you may be able to sign up through this special enrollment option. Just be sure you have the required documentation to provide the insurer.
APTC and Cost Sharing subsidies
The Advanced Premium Tax Credit (APTC) is a federal subsidy which has only been available to individuals and families who earn less that 400% (4 times) the Federal Poverty Level – which was, depending on the number of persons in a family somewhere between $12,060 for one person and $41,320 for a family of eight. The credit helps pay part of a person or family’s health insurance premiums
Cost sharing reduction was another kind of subsidy that helps reduce a person or family’s out-of-pocket costs, such as with deductibles and co-payments. According to the Center on Budget and Policy Priorities, individuals and families with incomes up to 250 percent of the poverty line ($61,500 for a family of four in 2017) were eligible for cost-sharing reductions (or CSRs) if they were eligible for a premium tax credit and purchased a silver plan through the health insurance marketplace in their state. People with lower incomes received the most assistance. In years past, the government issued CSRs to insurance companies to help reduce costs for consumers. But in November 2017, as the US administration has ended these cost-sharing subsidies, insurers have raised their premiums 15-21 percent to make up for it.
Unlike the premium subsidies (APTC), cost-sharing reductions were not provided as a tax credit and they do not have to be “reconciled” when people file their taxes for the year they received cost-sharing reductions.
Silver plans may be higher
In the 2017 open enrollment period, some consumers who qualify for and receive an APTC and enroll in a silver plan (one of four plans available), in the marketplace, may face higher premiums. Because of the higher premiums, some may opt to pay the penalty of $695 per adult without coverage or 2.5 percent of your household income — whichever is higher. The IRS has created a tool to easily determine what your fine will be if you opt out of the ACA healthcare marketplace. It is located here: https://taxpayeradvocate.irs.gov/estimator/isrp/
When you apply for coverage in the Health Insurance Marketplace, you estimate your expected income for the year. If you qualify for a premium tax credit based on your estimate, you can use any amount of the credit in advance to lower your premium according to Healthcare.gov.
Stiffer regulations for overdue payments
Also new to this year in the ACA rules are stiffer regulations for overdue payment. Mid year, a certain percentage of enrollees stop paying their premiums. Whether it’s because of job changes, life changes or switching plans, it is hard to determine. However the Center for U.S. Health System Reform reports that some may have gotten new insurance and forgot to notify their old issuers; but others simply couldn’t afford it. Those who fell behind will have to pay all overdue payments before they can enroll for the new year. For more on how the ACA may impact your taxes visit this link, https://www.e-file.com/help/aca-and-taxes.php .