Is Loss of Income a Qualifying Life Event for Health Insurance?

  • April 18, 2016
  • |Quartz
|
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Loss of income does not count as a qualifying life event for health insurance.

The short answer is no, income loss alone does not count as a qualifying event for health insurance. However, you may have some options.

People Who Have Subsidies for Health Insurance
Some people receive subsidies to help pay for their health insurance costs. These subsidies are based on estimated income for the year. But what happens if the income estimate turns out to be way too high? Is that a health insurance qualifying event?

The answer is “not exactly”, but you can get more help to pay for your plan. If you already get subsidies to help pay for your coverage, you can change your estimated income for your existing policy. You will need to login to your account at healthcare.gov and report a life change. Chances are, your subsidy amount will increase and your health plan will continue to be affordable. 

What If I Don’t Get subsidies?

If you don’t get subsidies and your income is much less than you estimated, you’ll generally need to wait until Open Enrollment to change your insurance policy.

However, it is possible that you may get a Special Enrollment Period due to your specific, complex circumstances. To do this, you need to apply directly to the Health Insurance Marketplace. It’s probably simplest to give them a call at 800.318.2596 (TTY: 855.889.4325) to find out if you have a health insurance qualifying event.

It’s also worthwhile to review exactly what constitutes qualifying events for health insurance. It could be that you have had or will have a health insurance qualifying event that makes it possible for you to change your policy. Be sure to keep in mind that generally you have to purchase a new policy within 60 days of that qualifying event.

Other Ways to Get Insurance

If your income falls below $11,880 for a single person, you may qualify for BadgerCare Plus, Wisconsin’s version of Medicaid.  You can sign up for BadgerCare Plus any time. If you don’t qualify for BadgerCare Plus and you live in Dane County, you may qualify for additional help from HealthConnect through United Way of Dane County. Rock County residents who make 100-150% of the Federal Poverty Level may qualify for additional help from Share + CARE through the Monroe Clinic Hospital Foundation.

Does It Make Sense to Go Without Insurance for a While?

If you can’t change your plan and paying premiums is a struggle, it may be tempting to drop your coverage. Before you do this, it’s important to know that you can be fined for not having insurance. The fine is large, the higher of the following – 

  • 2.5 percent of your yearly household income above the tax filing threshold, or
    • The maximum penalty is the total yearly premium for the national average price of a Bronze plan sold through the Marketplace.  In 2015, this was $2,484 for an individual or $12,240 for a family1. In 2016, this amount is likely to increase.
  • $695 per person ($347.50 for children under 18)
    • The maximum penalty per family using this method is $2,085

If you go without insurance for more than three months, you are more likely to be fined. It’s probably worth keeping your coverage when faced with this type of cost. Further, if you have an accident or get sick while you’re uninsured, you’ll end up paying the full cost of care, as well as the fine, unless you have a hardship exemption.

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