You log onto the troubled Healthcare.gov website and push yourself through the questions required to determine your eligibility for the tax credit only to find out it is not what you had expected. Up to this point, your blood pressure is high after all the 'error messages', the questions that are not liking your answers and now you have to leave because dinner is ready. All of this is after you had already spent three hours on this broken website. You are just ready to take your shoe off of your foot and beat the computer with it. The words I've heard so far are quite colorful. Then the gloves come off at the end for a fight when you, the parent, find out that you cannot add your children to the health plan and receive the tax credit.
Now you have a new problem to deal with.
Do not bother calling the Health Insurance Marketplace, they have told people "We are not touching that. We cannot add them". Do not call the Department of Insurance either. They will say "We know this is going on and we do not know why. At this point there is nothing we can do". Even the Governor's office will call you back and say the same thing. How is this possible?
It is because of the Medicare Expansion that was done in some states several years back before Healthcare Reform. The income limits in those states are much higher than the Federal Medicaid income limit. This forces the Marketplace to disqualify your children from the tax credit and inform you that they will be notified by the state. Some how the state is not getting the data to add them onto the Medicaid system.
So what is a parent going to do to make sure their child(ren) are covered?
There are four things you can do:
- Pay full price for your child(ren) with no tax credit in the Health Insurance Marketplace (Exchange) and only receive the tax credit for you and your spouse. This will require you to fill out completely two separate applications. This will also mean you will receive two separate policies and two separate bills to pay. One will have the tax credit with you and your spouse and the other one will be full retail price for your child(ren).
By applying through the Health Insurance Marketplace, and there is any eligibility for a tax refund when you file your taxes for providing health insurance, you will receive a refund. This is assuming you do qualify for the refund.
- You can apply directly through private exchange (see an insurance broker) and not take place in the Health Insurance Marketplace/Exchange. If you are eligible for any additional tax credit by paying for your child(ren)'s health insurance premiums, you will not receive a tax refund for it at the end of the year.
- You can decline the whole family from the tax credit and apply through the private exchanges (See insurance broker) and pay the retail price without the tax credit. This will allow everyone to be on the same policy with one premium.
- You can keep the tax credit for you and your spouse and put the kids on the Medicaid program in the state.
Despite the circumstances, parents do have choices. They may not be what you had in mind. They are still choices. This may also vary by state. It may be wise to seek expert help on it to make the right decision.
Note: Due to the Medicaid Expansion efforts, most likely, you will not receive a refund on your tax return even if you apply your child(ren) under a separate application inside the Marketplace/Exchanges.