What Happens If Your Income Drops Below Your ACA Application Estimate?

If you’ve recently enrolled in an ACA (Affordable Care Act) health plan and are now concerned that your income will be lower than you estimated on your application, it’s important to understand the potential consequences.

Income Verification and Eligibility

When you apply for an ACA plan, you are required to estimate your income for the upcoming year. This estimate is used to determine your eligibility for premium subsidies, which can significantly reduce the cost of your health insurance. If your actual income ends up being less than your estimate, you may be eligible for additional subsidies or even Medicaid coverage for your children.

Medicaid Eligibility for Children

In Illinois, there is a children’s Medicaid program called All-Kids. If your children’s income is below a certain threshold, they may be eligible for this program. If you originally estimated your income to be high enough that your children would not qualify for All-Kids, but your actual income is lower, you may want to consider re-applying for the program.

Reporting Income Changes

If your income drops significantly below your estimate, it’s important to report this change to the Health Insurance Marketplace as soon as possible. You can do this by logging into your account or calling the Marketplace directly.

Consequences of Underestimating Income

If you underestimate your income on your ACA application, you may end up paying higher premiums than you should have. Additionally, you may be required to pay back any subsidies you received if your actual income is significantly lower than your estimate.

Consequences of Overestimating Income

If you overestimate your income on your ACA application, you may qualify for higher subsidies than you are actually eligible for. This could result in you receiving a lower monthly premium, but it also could lead to a tax penalty when you file your taxes.

Seeking Professional Help

If you are unsure about how to report your income changes or are concerned about the potential consequences, it’s recommended that you seek help from a licensed agent or healthcare navigator. They can provide you with expert guidance and assist you with making the necessary adjustments to your ACA plan.

Remember: It’s important to be accurate in reporting your income on your ACA application. If your income changes significantly after you’ve enrolled in a plan, be sure to report these changes promptly to avoid any potential penalties or unexpected expenses.