ACA Health Insurance: Understanding Prorated Credits and Premium Payments

The Affordable Care Act (ACA) has provided access to health insurance for millions of Americans. However, understanding the nuances of ACA insurance plans and premium payments can be confusing. In this blog post, we will explore a specific scenario involving the termination of an ACA plan mid-month and its impact on premium credits.

What Happens When an ACA Plan is Terminated Mid-Month?

In the scenario presented, an individual terminated their Kaiser Permanente ACA plan mid-month. According to, the coverage ended on February 1, 2018. However, Kaiser Permanente claimed that the plan was terminated for non-payment of premiums on February 28, 2018.

When an ACA plan is terminated mid-month, the premium credit applied for that month is prorated. This means that the individual is responsible for paying the portion of the premium that corresponds to the coverage period before the termination date.

In this case, the individual was responsible for paying the prorated premium for the period from February 1 to February 28, 2018. Kaiser Permanente was not entitled to receive the entire premium credit for February since the coverage was terminated mid-month.

Kaiser Permanente’s Billing Error

The individual in question had issues with Kaiser Permanente’s billing department, which led to him distrusting their promise of a refund for the prorated premium. As a result, he did not pay the prorated premium upfront.

Kaiser Permanente’s subsequent termination of the plan for non-payment was a result of their own billing error. The individual had already terminated the plan through, and Kaiser Permanente was obligated to honor that termination date.

Recovery of Undue Enrichment

The individual questioned whether Kaiser Permanente had received the premium credit from the government for February, even though the coverage was terminated mid-month. If Kaiser Permanente did receive this credit, it would be considered undue enrichment.

In cases like this, individuals should contact the Health and Human Services (HHS) department to report the issue. HHS has the authority to investigate such matters and ensure that premium credits are applied correctly.

The individual in question requested a letter from HHS to confirm the proper termination date of his plan. Kaiser Permanente would then be required to return any undue enrichment, including the portion of the February premium credit that was not earned.


Terminating an ACA plan mid-month can be a complex process, especially if there are billing issues. Individuals should be aware of their rights and responsibilities regarding premium payments and termination dates. If they encounter any problems, they should seek assistance from licensed insurance agents or contact the HHS department.

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