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Anyone without health insurance has about two weeks left to get 2023 coverage through the public market — and subsidies can make it more affordable.
Open enrollment in the federal healthcare exchange lasts through January 15, with coverage going into effect February 1 (If your state has its own exchange, the last day to enroll may be different.) After the enrollment window closes, you generally need to experience a qualifying life event. – such as the birth of a child or marriage – to give them a special registration period.
Most registered in the market – 13 million from 14.5 million in 2022 – Eligible for federal benefits (technically tax credits) to help pay insurance premiums. Four out of five customers will be able to find 2023 plans for $10 or less per month after factoring in these tax breaks, according to the Centers for Medicare and Medicaid Services.
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Some people may also be eligible for cost-sharing assistance, such as deductibles and shared costs on certain plans, depending on their income.
For the most part, people who get insurance through a federal exchange (or exchange in their state) are self-employed, don’t have access to workplace insurance, or don’t qualify for Medicare or Medicaid.
As of December 15, nearly 11.5 million people have chosen a plan through the marketplace, according to CMS.
Tax breaks are more generous now
Subsidies are still more generous than they were before the pandemic. The expanded subsidies put in place for 2021 and 2022 have been temporarily extended through 2025 in Inflation Reduction Actwhich became law in August.
This means that there is no maximum income to qualify for benefits, and the amount anyone pays for insurance premiums is limited to 8.5% of their income as calculated by the exchange. Prior to the changes, assistance was generally only available to families with incomes ranging from 100% to 400%. Federal poverty level.
Which market benefits you qualify for depends on factors including income, age, and the second lowest cost “silver” plan in your geographic area (which may or may not be the plan you enroll in).
For the income portion of the decision, you’ll need to Estimate it for 2023 during the registration process.
Giving a good grade is important
Know that it is important to give a good grade.
If you end up having a higher annual income than you reported when you signed up, it may mean that you are not entitled to the same amount of assistance that you receive. Any increase in tax time will need to be accounted for in 2024 – which could reduce your refund or increase the amount of tax you owe.
“You don’t want a nasty surprise when you do your taxes next year,” said Cynthia Cox, director of the Affordable Care Act Program for the Kaiser Family Foundation.
Likewise, if you were entitled to more than you received, the difference will either increase your refund or decrease the amount of tax you owe.
Either way, at any time during the year, you can adjust your income estimate or note any related life changes (eg, having a baby, getting married, etc.) that might affect the amount of benefits you’re entitled to.
Defaulting on premiums can mean backing out
Know that if you do not pay your premiums (or your share of them), you will face cancellation of coverage and claims will become unpaid.
For enrollees who receive benefits, coverage is generally dropped after three months if the premiums are not made up. For those who pay the full premium because they don’t qualify for benefits, there’s only a grace period of about a month before canceling, depending on the state.
If you end up without insurance, you cannot re-enroll through the marketplace unless you qualify for a special enrollment period.