How to Navigate ACA Health Insurance When You’re in the Income Gap

If you’re earning too much to qualify for Medicaid but not enough to receive tax credits for ACA health insurance, you may feel like you’re in a tough spot. However, there are options available to help you get the coverage you need at an affordable price.

Understanding Income Thresholds and Tax Credits

Medicaid is a government-funded health insurance program for low-income individuals and families. In most states, the income limit to qualify for Medicaid is 133% of the Federal Poverty Level (FPL). For 2023, this equates to about $1,716 per month for a single person or $3,533 per month for a family of four.

ACA tax credits are available to individuals and families with incomes between 100% and 400% of the FPL. These tax credits help you lower the monthly cost of your premiums. For 2023, the income limit to qualify for the full amount of the tax credits is $55,500 for a single person or $118,000 for a family of four.

Options for Those in the Income Gap

If you’re in the income gap, here are some options to consider:

Apply for a Special Enrollment Period (SEP): If you experience a life event that causes you to lose health insurance, such as losing Medicaid, you may qualify for a SEP. This allows you to enroll in an ACA health insurance plan outside of the open enrollment period.
Consider a Bronze Plan: Bronze plans have the lowest monthly premiums but the highest out-of-pocket costs. If you’re healthy and don’t expect to use much healthcare, a Bronze plan could be a good option.
Look for Cost-Sharing Subsidies: If you qualify for tax credits, you may also qualify for cost-sharing subsidies. These subsidies help you lower the cost of your deductibles, copayments, and coinsurance.

Navigating Inconsistent Income

If your income is inconsistent, it’s important to estimate your income as accurately as possible when you apply for ACA health insurance. You’ll need to provide proof of your income, such as pay stubs or tax returns. If your income changes significantly during the year, you may need to update your application and adjust your tax credit amount.

Seeking Professional Help

If you’re struggling to navigate the ACA health insurance system, don’t hesitate to seek professional help. Licensed health insurance agents can assist you with finding the right plan for your needs and budget. Contact our experienced agents today to learn more about your options.