Moving one spouse from ACA to Medicare (2021 vs 2018)

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susa
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Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

In this thread .. viewtopic.php?t=260673 ... there are at least 2 points of interest and wanted to confirm if these are still true today, 3 years later (the original thread in link is from 2018)

1. It did not matter that one spouse went on Medicare to create a New Identity for the other spouse remaining on ACA as marketplace.gov still considered household income to calculate subsidy and premium -- the original "account holder" could simply sign up to ACA for the remaining spouse

Is this still true today ?

2. In this post there is the following "warning"
If you don't do the sign up for Medicare correctly then it will cost you big time if you are receiving an ACA subsidy. Once you turn 65 then you are automatically enrolled in part A Medicare which is important because you then lose your ACA subsidy. This is very confusing because the law says you have a 7 month window to enroll in Medicare - 3 months before your birthday month to 3 months after your birthday month. But no one is going to notify you that you will lose the subsidy. Now if you are still on the ACA plan after your birthday month then you will get a nasty surprise from the IRS when you file your taxes the following year because now you will owe back all that money that the government paid the insurance company for your premium subsidy. The best thing to do is sign up for Medicare 3 months before you turn 65 so that Part A and B start on the first day of your birthday month.
Is this still true today ?
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susa
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

The following quote is from medicareresources.org
If you're already receiving Social Security or Railroad Retirement benefits, the government will automatically enroll you in Medicare Part A the month you turn 65, with your Medicare card arriving in the mail about three months before you turn 65. ... Your Medicare card will be sent to you after you enroll.
Thus, to answer the original question, if a person is NOT enrolled in Social Security despite turning 65, perhaps there is no problem in waiting past the month of turning 65 and taking advantage of the 7 month period ?

The following quote is from medicare.gov
Medicare will enroll you in Part B automatically. Your Medicare card will be mailed to you about 3 months before your 65th birthday. If you're not getting disability benefits and Medicare when you turn 65, you'll need to call or visit your local Social Security office, or call Social Security at 1-800-772-1213
https://www.medicareresources.org/medic ... -medicare/
https://www.medicare.gov/Pubs/pdf/11036 ... Part-B.pdf
DetroitRick
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by DetroitRick »

For what it's worth, I just made the transition to Medicare effective Feb 1, while my spouse remains on ACA for a number of years.

As of this year, you still must notify Healthcare.gov that you are transitioning to Medicare. Medicare doesn't formally tell them so this is very important. Although I did get a reminder from Healthcare.gov by email on the Medicare transition. Again as of 2021, you have to do this with a call to the Healthcare.gov call center (if your state uses the Fed site). They then make the necessary notifications to your health insurer. In fact, a preliminary call to my health insurer proved totally non-productive as their front-line call center did not understand the transition process correctly at all (I was concerned about not paying my February premium until this transition was processed, they told me to get this going as far in advance as possible - which cannot be done).

When you call Healthcare.gov, they will terminate your coverage effective one day prior to your call. As of January 2021, they still had no capability to handle this in advance (I asked two different times and got this answer). The important issue is terminating your premium subsidy the day before your Medicare Part A eligibility, and this call will effect that termination too.

Here's how it went down for me. One difference in my case, I was on Social Security and my Medicare enrollment was automatic. But all else is the same as what you asked:

1)Healthcare.gov account was in my name, with spouse listed, and still is.
2)I called Healthcare.gov to request termination of my ACA policy and continuance of wife's. I did that on January 30, and my coverage was terminated on January 29 end of day, as was wife's policy, with an immediate re-enrollment of wife in same policy. I should have made that call on February 1, my Medicare start date, but whatever. I was uninsured for 2 days as a result. Wife was continuously insured, as her original policy was cancelled and immediately reissued. Wife's subsidy was recomputed based on same household income originally reported on 2021 application (because I didn't need/request any change to my estimate as I could have), but now just on HER premium and that income. That call to Healthcare.gov also handled the new application for my wife. By end of 30-minute call - all was complete and all this became visible online.
3)It took about 5 business days +/- for my insurer to pick all this up and reflect in our online accounts there. At that point, my coverage was confirmed as terminated effective January 29, wife's was as well, and wife's account reflected a new policy (same policy number) starting on January 30. So, her February coverage was technically "past due" with the insurer, but that didn't present an issue because of their grace period.
4)We received premium refunds (gross premium less subsidy) for two days in January - both of us - and she got a new bill for those two days plus February. All pro-rated and correct to the penny. I got a check, she got a bill credit.
5)The healthcare.gov account remained in my name, contrary to my request and what I was told, but now shows only my wife's continuing coverage (and both of our historical applications, cancelled coverage, etc.). So that worked out too.
6)My wife's pre-transition claims (for January) were correctly applied to her new individual policy deductible. Her outstanding referrals were correctly transitioned too. Frankly, I was amazed...

So the important thing with all this is simply to terminate ACA coverage when Medicare starts. And the subsidy eligibility goes away for the Medicare recipient immediately upon eligibility (regardless of actual start date, or so I've been told repeatedly). I wouldn't think it would be the end of the world if notification slipped a few days (since subsidy is trued up at tax time), but frankly I have no idea. So I worked that cutoff to avoid any potential overlap.

One difference currently going on - ACA open enrollment (Feb 15, 2021 to August 15) means the spouse remaining on ACA can choose the same policy or a new policy at the moment. But as far as I have heard, a new policy generally means a re-start on your deductible. Whether any insurers make exceptions, I do not know.

All this went pretty smooth and routine. I did have to make 3 call to Healthcare.gov to get a competent rep on January 30, but once I did, the third rep knew exactly what was necessary and handled all smoothly within that half hour. Everything on our insurer's end was automatic and done behind-the-scenes.

Hope this helps.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by marcopolo »

Too late for many, but when signing up for ACA coverage for the first time as a couple, it is helpful to list the younger spouse as the primary account holder. Then when the older spouse transitions to Medicare, they can simply be dropped from the policy while the primary account holder continues coverage. It avoids some of the complexity described above.
Once in a while you get shown the light, in the strangest of places if you look at it right.
Jablean
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by Jablean »

marcopolo wrote: Sun May 30, 2021 10:33 pm Too late for many, but when signing up for ACA coverage for the first time as a couple, it is helpful to list the younger spouse as the primary account holder. Then when the older spouse transitions to Medicare, they can simply be dropped from the policy while the primary account holder continues coverage. It avoids some of the complexity described above.
Tried that, not on purpose but just because I do all this type of stuff. Our exchange is state ran and puts everything in DH's name. I'll see what happens next year as we'll be doing the same transition.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

DetroitRick wrote:.. I just made the transition to Medicare effective Feb 1, while my spouse remains on ACA for a number of years.
It was not clear what this Feb 1 means, in terms of the 7 month enrollment period, in your case ?

Based on the thread from 2018, it was an ominous warning that appeared to apply only to those WHO ARE on SocSec, but does not apply if you have not enrolled on SS.

What was this Feb 1 in your case, the -3 month or 0 month or +3 month date ?

Also, since there is always some kind of delay, unless you apply -3 months before birthday month, I am guessing you applied for the same month as BD but what would have happened if you applied BD plus 1 month (Mar), there would have been a 2 month delay (May) --- so depending on when you apply inside this 7 month period, it apparently is important NOT TO CALL TOO EARLY the marketplace.gov phone support ? Based on your account, if they really terminate immediately -1 day, it could really screw up the delayed enrollment period if call happens after month of BD.

Here is what I picked up from an online example for a person with BD in September.

If you enroll in June, July or August, Medicare starts September 1.
If you enroll in September, Medicare begins October 1.
If you enroll in October, Medicare starts December 1.
If you enroll in November, Medicare starts February 1, next year
If you enroll in December, Medicare starts March 1, next year

As a recap, if the intention was to start Medicare in December, the person should make that call December 1, 2021 to healthcare.gov but should have applied for Medicare online (again, no SocSec) inside October 2021 without telling either insurance company OR the healthcare exchange.

Is that correct ?
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by DetroitRick »

Feb 1 in my case, is my birthday month (and my date of initial Medicare eligibility because I was NOT born on the first). For me it's 4th month of that 7-month enrollment window (or "0 month" in -3 to 3 terminology).

Regardless of when you actually apply during that 7 months initial enrollment window, Medicare will quickly notify you as to exact coverage start date. My recollection was my forthcoming Medicare start date showed on my Medicare account by early November (-3 month), and card arrived about two weeks later, still in 2020.

So, if you are delaying actual start of Medicare beyond the first of your birthday month, there are a few more scenarios. This article covers those in detail:
https://www.medicareresources.org/medic ... -medicare/
See the 4 scenarios outlined below the "If you complete the enrollment processing" heading

All this boils down into two things you want to avoid: 1)paying back any ACA subsidy that you got post-Medicare, 2)having both ACA and Medicare coverage simultaneously (because of cost and the fact that they don't coordinate). I would surmise that the "nasty surprise" highlighted in your first comment simply represents payback of ACA subsidies received after starting Medicare.

To your example: person starts Medicare December 1, yes they should call Healthcare.gov on Dec 1 to cancel and Medicare enrollment should (for most) have been completed in October or November, ideally. Prior actual notification to either Healthcare.gov or insurer won't accomplish anything (unless this has somehow changed since January).
Last edited by DetroitRick on Mon May 31, 2021 12:44 pm, edited 1 time in total.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

DetroitRick wrote: ... I would surmise that the "nasty surprise" highlighted in your first comment simply represents payback of ACA subsidies received after starting Medicare.
As there was no explanation since and no comment to directly address it since, 3 years having passed, it was puzzling why no comments or experiences were shared among those who delay SocSec until 70 but go on Medicare as transition from ACA Healthcare.Gov.

Thank you for sharing your experience.
Last edited by susa on Mon May 31, 2021 9:23 am, edited 1 time in total.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

Just re-read the section If you enroll in Medicare during the three months following the month you turn 65
Based on the CMS guidance and the retroactive government coverage rule in IRS Publication 974, you should expect your premium subsidy to continue through the month that you enroll, but that it will not be available starting the following month.
Based on this, is this how it should be understood for a person with BD in September but wanting Medicare to start in December:

1) Enrolls online in October (BD +1) month with a 2 month delay of start of benefits
2) Subsidy from ACA Healthcare.Gov continues for October but STOPS there and No Subsidy for November

No subsidy was/is to be expected for December, as it is the official start of Medicare. Insurance company is not notified of anything for October or November and marketplace is not notified until December 1.

Does this mean, insurance company will retroactively bill for November, the one gap month, once they "find out" in December ?
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

Small rule update which was learned today on a conference call (Healthcare.Gov rep also on call)

As of today and extended until at least August 15, 2021, the day a person informs Healthcare.Gov they are going on Medicare, their system DOES NOT CANCEL the ACA plan that day. The example they quoted was an imaginary couple where one spouse starts Medicare in July 2021 and calls today. The ACA policy for BOTH spouses remains in effect June and drops coverage for one spouse effective last day of June and keeps it through EOY for the remaining spouse.

Similarly, if the person calls today and informs they are going on Medicare starting in August 2021, they will keep both on ACA until end of July and drop one person EOM July and maintain ACA until EOY for the remaining spouse.

They also said this "rule" is due to the pandemic and has already been extended several times and may be extended again but currently is in force until August 15, 2021 with future unknown today.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by Eagle33 »

What if the person calls today in June and they are starting Medicare Sept. 1? Does ACA end on Aug. 15 or 31?
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

Eagle33 wrote: What if the person calls today in June and they are starting Medicare Sept. 1? Does ACA end on Aug. 15 or 31?
Why would anyone call in June if simply doing a "silent online enrollment"?

As long as the individual IS NOT collecting SocSec, the marketplace and insurance company is blind to personal choice of Start Date of Medicare and no "automatic enrollment" takes place. The August 15 date is apparently fluid and is considered as of now a date of notice deadline for special handling. If the goal was to establish a clean break and no SocSec is being collected then the best date to call would be August 15, unless, again, the date is extended and in that case the best date is any day in August.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by MichaelRpdx »

Following.
Thank you for the conversation.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

Posting as follow-up in this thread ...

If there is anyone on the forum that care to share and meets the following criteria/conditions:

(1) Has not applied for Social Security and does not plan to file in 2021
(2) Has active ACA Healthcare.gov subsidy in 2021 or had it until applying for Medicare
(3) Turned 65 but waited past their birthday month (BD +1, +2 or +3) to file for Medicare
(4) Enrolled in Medicare online only since not on Social Security

Friends and relatives keep sending messages that Insurance Agents are claiming that ACA Subsidy will "stop" or be "clawed back" if waiting past BD month to enroll in Medicare (+1, +2, +3).

I keep telling them that "As long as you are not collecting Social Security" there is no automatic enrollment and there is no loss of ACA Subsidy and no loss of insurance until Medicare kicks in on a delayed schedule

In this same thread I had posted this from an online example for a person with BD in September and considers +1,+2 or +3 month enrollment to Medicare

If you enroll in October, Medicare starts December 1. (Healthcare.gov notified 12/1/2021 - only 1 month loss of subsidy)
If you enroll in November, Medicare starts February 1, next year (no notice to Healthcare.gov, no loss for subsidy in 2021)
If you enroll in December, Medicare starts March 1, next year (no notice to Healthcare.gov, no loss for subsidy in 2021)
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by nalor511 »

Does the subsidy for the remaining spouse on ACA get calculated:

1. Using both incomes, using subsidy/threshold for 2 people?
2. Using both incomes, using subsidy/threshold for 1 person?

Would suck if it's#2
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by Northern Flicker »

nalor511 wrote: Sun Sep 19, 2021 4:44 pm Does the subsidy for the remaining spouse on ACA get calculated:

1. Using both incomes, using subsidy/threshold for 2 people?
2. Using both incomes, using subsidy/threshold for 1 person?
The tax credit is calculated based on total household income (including income of all dependents) and the numbered insured with a plan qualifying for a tax credit.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by nalor511 »

Northern Flicker wrote: Sun Sep 19, 2021 4:53 pm
nalor511 wrote: Sun Sep 19, 2021 4:44 pm Does the subsidy for the remaining spouse on ACA get calculated:

1. Using both incomes, using subsidy/threshold for 2 people?
2. Using both incomes, using subsidy/threshold for 1 person?
The tax credit is calculated based on total household income (including income of all dependents) and the numbered insured with a plan qualifying for a tax credit.
So, #2 then, worst of all worlds
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by marcopolo »

Northern Flicker wrote: Sun Sep 19, 2021 4:53 pm
nalor511 wrote: Sun Sep 19, 2021 4:44 pm Does the subsidy for the remaining spouse on ACA get calculated:

1. Using both incomes, using subsidy/threshold for 2 people?
2. Using both incomes, using subsidy/threshold for 1 person?
The tax credit is calculated based on total household income (including income of all dependents) and the numbered insured with a plan qualifying for a tax credit.
Are you sure about the second part?

The FPL is based on family size. I don't think it matters whether everyone is getting coverage through market place or not, I believe they would still be included in family size count. Then the threshold is based on multiple of FPL.

It does become harder to qualify for tax credits when one spouse goes on Medicare because the cost of the marketplace coverage becomes smaller (only covering one person instead of two), so the premium might be lower than the expected contribution based on income. But, that comparison, I believe is done, based on the FPL thresholds for the full family size.
Once in a while you get shown the light, in the strangest of places if you look at it right.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by curmudgeon »

This is an interesting thread which may well apply to us in a few years. With the older spouse turning 65 in the latter half of the year, it would be helpful if we can delay medicare those three months - can put more in HSA, possibly lower subsidized premium cost, lose less of subsidy for younger spouse. I suspect rules will continue to shift underfoot, making this something to track closely. At a very rough guess, it might make $1K difference in cost/taxes for us; significant, but not worth getting into a pile of bureaucratic battles and risk of misinterpretations that might take a lot of pain to sort out.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by InMyDreams »

OP, contacting your local SHIP office may provide answers. One advantage of SHIP - they don't make money from the decisions that you make.

From Medicare for Dummies, copyright 2021, beginning pg 162, and starts with What follows with information relating to the ACA as it stand in early 2020...

pg 163
"If I'm happy with the Marketplace plan I have, must I switch to Medicare?"
The law allows you to keep your plan in you want, but there are good reason why you shouldn't:
>> You will no longer qualify for any subsidies or tax credits that reduce the cost of your Marketplace premiums...
>> Unless your Marketplace plan comes from an employer..., delaying signing up for Medicare beyond age 65 makes you liable for a gap in coverage and late penalties that would be permanently added to your Medicare premiums....
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

InMyDreams wrote: From Medicare for Dummies, copyright 2021, beginning pg 162, and starts with What follows with information relating to the ACA as it stand in early 2020...
That has actually nothing to do in situation when people are NOT collecting Social Security and is being confused with people on SS and ACA and Medicare eligible.

To recap ...

If you are on SS, then Medicare enrollment is Automatic at 65, the Month Of BD.
If you are NOT on SS, then you have a 7 month moving window, 3 months before BD, BD and 3 months later.

If you are collecting SS and on ACA then you terminate ACA on the month Medicare kicks in at 65 and if there are more months in the year, the helpful hands at Healthcare.gov will stop ACA (and subsidy the month you call in).

If you are NOT collecting SS and on ACA, you decide when to enroll and if you have the ideal situation of my example BD of person born in September, you can enroll Sep, Oct, Nov and Dec and if you pick Nov or Dec then ACA folks are completely in the dark and have no say to your decision as your will simply roll off their books at EOY while collecting ACA subsidy until EOY since Medicare will not start until Feb 2022 or Mar 2022.

In any situation above, the person is strictly on either (1) ACA policy or (2) Medicare and no overlap occurs.

Simple and easy.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by Northern Flicker »

nalor511 wrote: Sun Sep 19, 2021 5:06 pm
Northern Flicker wrote: Sun Sep 19, 2021 4:53 pm
nalor511 wrote: Sun Sep 19, 2021 4:44 pm Does the subsidy for the remaining spouse on ACA get calculated:

1. Using both incomes, using subsidy/threshold for 2 people?
2. Using both incomes, using subsidy/threshold for 1 person?
The tax credit is calculated based on total household income (including income of all dependents) and the numbered insured with a plan qualifying for a tax credit.
So, #2 then, worst of all worlds
No, it was far worse before we had ACA.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by marcopolo »

susa wrote: Sun Sep 19, 2021 7:03 pm
InMyDreams wrote: From Medicare for Dummies, copyright 2021, beginning pg 162, and starts with What follows with information relating to the ACA as it stand in early 2020...
That has actually nothing to do in situation when people are NOT collecting Social Security and is being confused with people on SS and ACA and Medicare eligible.

To recap ...

If you are on SS, then Medicare enrollment is Automatic at 65, the Month Of BD.
If you are NOT on SS, then you have a 7 month moving window, 3 months before BD, BD and 3 months later.

If you are collecting SS and on ACA then you terminate ACA on the month Medicare kicks in at 65 and if there are more months in the year, the helpful hands at Healthcare.gov will stop ACA (and subsidy the month you call in).

If you are NOT collecting SS and on ACA, you decide when to enroll and if you have the ideal situation of my example BD of person born in September, you can enroll Sep, Oct, Nov and Dec and if you pick Nov or Dec then ACA folks are completely in the dark and have no say to your decision as your will simply roll off their books at EOY while collecting ACA subsidy until EOY since Medicare will not start until Feb 2022 or Mar 2022.

In any situation above, the person is strictly on either (1) ACA policy or (2) Medicare and no overlap occurs.

Simple and easy.
How do you square your position with this from the IRS Website (highlight is mine):

You or a tax family member enrolled in health insurance coverage through the Marketplace for at least one month of a calendar year in which he or she was not eligible for affordable coverage through an eligible employer-sponsored plan that provides minimum value or eligible to enroll in government health coverage – like Medicare, Medicaid, or TRICARE.


Or this from the Medicare website:

Can I choose Marketplace coverage instead of Medicare?
Generally, no. As noted on the previous page, it’s against the law for someone who knows you have Medicare
to sell you a Marketplace plan. But there are some situations where you can choose Marketplace coverage
instead of Medicare:
• You can choose Marketplace coverage if you’re eligible for Medicare but haven’t enrolled in
it (because you would have to pay a Part A premium, or because you’re not collecting Social
Security benefits). If you’re eligible for premium-free Part A but choose Marketplace coverage
over it, you won’t be eligible for help paying your Marketplace plan premiums.


It seems to me when you turn 65 you are eligible for Medicare, you can choose to wait to sign up, that does not change the fact that you are eligible to do so. It also seems that being eligible for Medicare disqualifies one from receiving ACA tax-credits.

I have not read through the entire thread, but is there some other language from the IRS, the ACA, or Medicare that would lead you to believe otherwise?

You are right that if you time it correctly, the marketplace will not know. But, you do have to reconcile things on your tax return. There are lots of things that the government does not know about, but that you are supposed to properly report on your tax return.
Once in a while you get shown the light, in the strangest of places if you look at it right.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by nalor511 »

Northern Flicker wrote: Sun Sep 19, 2021 7:09 pm
nalor511 wrote: Sun Sep 19, 2021 5:06 pm
Northern Flicker wrote: Sun Sep 19, 2021 4:53 pm
nalor511 wrote: Sun Sep 19, 2021 4:44 pm Does the subsidy for the remaining spouse on ACA get calculated:

1. Using both incomes, using subsidy/threshold for 2 people?
2. Using both incomes, using subsidy/threshold for 1 person?
The tax credit is calculated based on total household income (including income of all dependents) and the numbered insured with a plan qualifying for a tax credit.
So, #2 then, worst of all worlds
No, it was far worse before we had ACA.
Irrelevant
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by Northern Flicker »

Not really. ACA provided premium tax credits to make health insurance more affordable for people in certain income brackets. You would like it to be even more generous than it is.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by Northern Flicker »

marcopolo wrote: Sun Sep 19, 2021 5:45 pm
Northern Flicker wrote: Sun Sep 19, 2021 4:53 pm
nalor511 wrote: Sun Sep 19, 2021 4:44 pm Does the subsidy for the remaining spouse on ACA get calculated:

1. Using both incomes, using subsidy/threshold for 2 people?
2. Using both incomes, using subsidy/threshold for 1 person?
The tax credit is calculated based on total household income (including income of all dependents) and the numbered insured with a plan qualifying for a tax credit.
Are you sure about the second part?

The FPL is based on family size. I don't think it matters whether everyone is getting coverage through market place or not, I believe they would still be included in family size count. Then the threshold is based on multiple of FPL.

It does become harder to qualify for tax credits when one spouse goes on Medicare because the cost of the marketplace coverage becomes smaller (only covering one person instead of two), so the premium might be lower than the expected contribution based on income. But, that comparison, I believe is done, based on the FPL thresholds for the full family size.
The number of insured persons is an input that determines the cost of the 2nd lowest silver plan. The total family income is compared to the federal poverty level income for family size with multipliers, so the family size is an input to that.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by marcopolo »

Northern Flicker wrote: Mon Sep 20, 2021 1:07 am
marcopolo wrote: Sun Sep 19, 2021 5:45 pm
Northern Flicker wrote: Sun Sep 19, 2021 4:53 pm
nalor511 wrote: Sun Sep 19, 2021 4:44 pm Does the subsidy for the remaining spouse on ACA get calculated:

1. Using both incomes, using subsidy/threshold for 2 people?
2. Using both incomes, using subsidy/threshold for 1 person?
The tax credit is calculated based on total household income (including income of all dependents) and the numbered insured with a plan qualifying for a tax credit.
Are you sure about the second part?

The FPL is based on family size. I don't think it matters whether everyone is getting coverage through market place or not, I believe they would still be included in family size count. Then the threshold is based on multiple of FPL.

It does become harder to qualify for tax credits when one spouse goes on Medicare because the cost of the marketplace coverage becomes smaller (only covering one person instead of two), so the premium might be lower than the expected contribution based on income. But, that comparison, I believe is done, based on the FPL thresholds for the full family size.
The number of insured persons is an input that determines the cost of the 2nd lowest silver plan. The total family income is compared to the federal poverty level income for family size with multipliers, so the family size is an input to that.
Agree that is how it works.
Just pointing out the income threshold is based on family size, not number of insured. I thought that is what the question asked, but perhaps not.
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susa
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

susa wrote: Posting as follow-up in this thread ...

If there is anyone on the forum that care to share and meets the following criteria/conditions:

(1) Has not applied for Social Security and does not plan to file in 2021
(2) Has active ACA Healthcare.gov subsidy in 2021 or had it until applying for Medicare
(3) Turned 65 but waited past their birthday month (BD +1, +2 or +3) to file for Medicare
(4) Enrolled in Medicare online only since not on Social Security

Friends and relatives keep sending messages that Insurance Agents are claiming that ACA Subsidy will "stop" or be "clawed back" if waiting past BD month to enroll in Medicare (+1, +2, +3).

I keep telling them that "As long as you are not collecting Social Security" there is no automatic enrollment and there is no loss of ACA Subsidy and no loss of insurance until Medicare kicks in on a delayed schedule

In this same thread I had posted this from an online example for a person with BD in September and considers +1,+2 or +3 month enrollment to Medicare

If you enroll in October, Medicare starts December 1. (Healthcare.gov notified 12/1/2021 - only 1 month loss of subsidy)
If you enroll in November, Medicare starts February 1, next year (no notice to Healthcare.gov, no loss for subsidy in 2021)
If you enroll in December, Medicare starts March 1, next year (no notice to Healthcare.gov, no loss for subsidy in 2021)
Posting new follow-up as we actually found a case and verified with a conference call to Healthcare.Gov with a very large helpful hands person (my description of someone who knows how this really works).

Lessons learned today during the call and from the actual case (a MFJ, neither one on Social Security, both on ACA and one ready to enroll Medicare inside Sep 2021 but not yet enrolled, receiving a subsidy on ACA which resulted in Zero monthly payments on Silver Plan):

(1) No automatic Medicare enrollment (not on Social Security)
(2) Must apply online via ssa.gov logon on the "Month -3,-2,-1 or 0 = the actual BD month"
(3) If waiting (by Medicare rules) for months past BD, +1,+2,+3 then not only is subsidy LOST but it is LOST FOR BOTH !!
(4) Medicare does not care or interact with ACA in any way, so the 7 month window is still valid and ACA does not care about Medicare in the sense that they allow "eligible to enroll" person to remain on ACA, they just remove the subsidy and now Zero monthly premiums suddenly become over $2,000.00/month bills to pay.
(5) Once Medicare enrollment is done, then ACA needs a phone call, -1 day before the eligible "Medicare Start date". They (Healthcare.Gov) will drop the one spouse off the ACA plan and the couple can then decide to keep primary as the "application contact person" for the ACA plan remaining individual OR they can completely drop that primary person and use new email credentials for the remaining spouse.

In the actual example case, if the one spouse ready to Medicare waits, then the loss/charge/clawback to both of them is over $2,000 for every month that is +1 (So it would be $2,000x3=$6,000.00 cost) or more after the BD month of the Medicare "ready" individual. Since Medicare Part B is 148.50/month, the Medicare eligible spouse signed up today with a Medicare start date (if process online works as planned) of October 1 and will call Healthcare.Gov on September 30 to make the adjustments.

So in summary, it appears the warning from 2018 was valid and what was learned from todays call was that it would have been even more catastrophic in cost to the couple if they waited to act immediately.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by marcopolo »

susa wrote: Mon Sep 20, 2021 12:24 pm
susa wrote: Posting as follow-up in this thread ...

If there is anyone on the forum that care to share and meets the following criteria/conditions:

(1) Has not applied for Social Security and does not plan to file in 2021
(2) Has active ACA Healthcare.gov subsidy in 2021 or had it until applying for Medicare
(3) Turned 65 but waited past their birthday month (BD +1, +2 or +3) to file for Medicare
(4) Enrolled in Medicare online only since not on Social Security

Friends and relatives keep sending messages that Insurance Agents are claiming that ACA Subsidy will "stop" or be "clawed back" if waiting past BD month to enroll in Medicare (+1, +2, +3).

I keep telling them that "As long as you are not collecting Social Security" there is no automatic enrollment and there is no loss of ACA Subsidy and no loss of insurance until Medicare kicks in on a delayed schedule

In this same thread I had posted this from an online example for a person with BD in September and considers +1,+2 or +3 month enrollment to Medicare

If you enroll in October, Medicare starts December 1. (Healthcare.gov notified 12/1/2021 - only 1 month loss of subsidy)
If you enroll in November, Medicare starts February 1, next year (no notice to Healthcare.gov, no loss for subsidy in 2021)
If you enroll in December, Medicare starts March 1, next year (no notice to Healthcare.gov, no loss for subsidy in 2021)
Posting new follow-up as we actually found a case and verified with a conference call to Healthcare.Gov with a very large helpful hands person (my description of someone who knows how this really works).

Lessons learned today during the call and from the actual case (a MFJ, neither one on Social Security, both on ACA and one ready to enroll Medicare inside Sep 2021 but not yet enrolled, receiving a subsidy on ACA which resulted in Zero monthly payments on Silver Plan):

(1) No automatic Medicare enrollment (not on Social Security)
(2) Must apply online via ssa.gov logon on the "Month -3,-2,-1 or 0 = the actual BD month"
(3) If waiting (by Medicare rules) for months past BD, +1,+2,+3 then not only is subsidy LOST but it is LOST FOR BOTH !!
(4) Medicare does not care or interact with ACA in any way, so the 7 month window is still valid and ACA does not care about Medicare in the sense that they allow "eligible to enroll" person to remain on ACA, they just remove the subsidy and now Zero monthly premiums suddenly become over $2,000.00/month bills to pay.
(5) Once Medicare enrollment is done, then ACA needs a phone call, -1 day before the eligible "Medicare Start date". They (Healthcare.Gov) will drop the one spouse off the ACA plan and the couple can then decide to keep primary as the "application contact person" for the ACA plan remaining individual OR they can completely drop that primary person and use new email credentials for the remaining spouse.

In the actual example case, if the one spouse ready to Medicare waits, then the loss/charge/clawback to both of them is over $2,000 for every month that is +1 (So it would be $2,000x3=$6,000.00 cost) or more after the BD month of the Medicare "ready" individual. Since Medicare Part B is 148.50/month, the Medicare eligible spouse signed up today with a Medicare start date (if process online works as planned) of October 1 and will call Healthcare.Gov on September 30 to make the adjustments.

So in summary, it appears the warning from 2018 was valid and what was learned from todays call was that it would have been even more catastrophic in cost to the couple if they waited to act immediately.
That seems aligned with what both the IRS and Medicare web site clearly states ( see my post a few posts above). Still curious what led to any other belief, and such a long discussion?
Once in a while you get shown the light, in the strangest of places if you look at it right.
InMyDreams
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by InMyDreams »

So, it sounds like the Medicare-eligible spouse has enrolled in MCare Part B, avoiding late enrollment penalties.

Also important to enroll in MCare Part D (if enrolling in Medigap) to avoid its late enrollment penalties.

Also important to enroll in a Medigap plan during its enrollment period to insure that you can without underwriting (can vary by state).

-or-

enroll in MedAdvantage during its enrollment period (can vary by state)

Medicare for Dummies is a thorough book, recommended by many BHers.

There are various MCare premium assistance programs that are based on FPL (not sure about assets). Your local SHIP counselor will know about them.
Northern Flicker
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by Northern Flicker »

From: https://www.irs.gov/affordable-care-act ... the-basics
You are eligible for the premium tax credit if you meet all of the following requirements. You:
...
Are not eligible for coverage through a government program, like Medicaid, Medicare, CHIP or TRICARE.
...
ACA enrollment sites say the same. You cannot preserve eligibility for an ACA premium tax credit by delaying enrollment in medicare past the month of initial eligibility.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by Retired2013 »

Question on when to call to cancel ACA. When do you call if the 1st is Monday? Do you call on Friday and technically you are uninsured over the weekend?
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

Retired2013 wrote: Question on when to call to cancel ACA. When do you call if the 1st is Monday?
You call Sunday. Open 7 days.

As to the original example found....she picked just original Medicare A and B...nothing else.. no supplemental anything, D plan penalty is not a scare if picked up later
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by Northern Flicker »

I would not consider a part B supplement to be optional. If you do not take it at initial part B enrollment, there is medical underwriting to clear. The problem with covering the 20% not covered by part B yourself is that there is no annual out-of-pocket maximum to cap the out-of-pocket costs. There are expensive outpatient treatments and procedures, and not everything that happens in a hospital is covered by part A. Some things may be covered by part B.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by InMyDreams »

Northern Flicker wrote: Wed Sep 22, 2021 3:45 pm I would not consider a part B supplement to be optional.
+ 1. Either that, or enroll in a MedAdvantage plan - $0 premium plans exist in many places
Northern Flicker wrote: Wed Sep 22, 2021 3:45 pm If you do not take it at initial part B enrollment, there is medical underwriting to clear.
meaning - no guaranteed issue, either, tho that varies by state.
Northern Flicker wrote: Wed Sep 22, 2021 3:45 pm The problem with covering the 20% not covered by part B yourself is that there is no annual out-of-pocket maximum to cap the out-of-pocket costs. There are expensive outpatient treatments and procedures, and not everything that happens in a hospital is covered by part A. Some things may be covered by part B.
Been there, seen that, not pretty. The person who comes to mind had several months of very expensive treatment before open enrollment allowed enrollment into a MedAdvantage plan.


Keeping the door open to Part D with a $7.30/month premium is worth it to me.

https://www.medicare.gov/drug-coverage- ... nt-penalty
The cost of the late enrollment penalty depends on how long you went without Part D or creditable prescription drug coverage.

Medicare calculates the penalty by multiplying 1% of the "national base beneficiary premium" ($33.06 in 2021) times the number of full, uncovered months you didn't have Part D or creditable coverage. The monthly premium is rounded to the nearest $.10 and added to your monthly Part D premium.

The national base beneficiary premium may change each year, so your penalty amount may also change each year.

You’ll generally have to pay the penalty for as long as you have Medicare drug coverage.

Your local SHIP volunteer could be of assistance.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

Posting follow-up as we learned something new (to us) today:

Our example individual with a 65th birthdate month September 2021 is the older spouse of a couple where both are receiving Healthcare.gov subsidy on a Silver Plan with zero monthly premium, ie. subsidy covers everything.

She enrolled Medicare online in September 2021 and received in one week a response/call from ssa.gov/welcome letter online from ssa.gov with new Medicare ID and start date for Part A and Part B.

Previously, she had been told to "call Healthcare.gov Marketplace customer support" the "last day of September" to remove yourself from ACA plan and leave spouse on for 3 months remaining (Oct,Nov,Dec).

Today, there were 2 agents from the Marketplace on a call, both advising NOT to cancel today as the cancellation is "day of the phone call -1 day" so Friday October 1 enacts cancellation for Thursday September 30.

She also learned from ssa.gov phone call from the documents support unit (direct phone call initiated by ssa.gov) that they had retroactively started Part A Hospital as of September 1, 2021 but Part B starts October 1, 2021

Nobody (not Healthcare.gov and not ssa.gov) could answer "Does this mean the Silver Plan ACA Subsidy paid for the month of September is in jeopardy?"

She opted to go ahead and have Marketplace.gov remove her from the ACA plan today so technically, she has no health coverage for 24 hours via ACA as she reasoned that technically she does have Part A Hospital (free) coverage from Medicare as learned from ssa.gov phone call.

The big unknown now is - Will they experience a subsidy clawback for September, for Both spouses, for the entire year, in other words, did they violate the "once you are eligible"-rule by not pre-enrolling in Medicare online in June-August for September 1.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by curmudgeon »

susa wrote: Thu Sep 30, 2021 12:52 pm

Nobody (not Healthcare.gov and not ssa.gov) could answer "Does this mean the Silver Plan ACA Subsidy paid for the month of September is in jeopardy?"

She opted to go ahead and have Marketplace.gov remove her from the ACA plan today so technically, she has no health coverage for 24 hours via ACA as she reasoned that technically she does have Part A Hospital (free) coverage from Medicare as learned from ssa.gov phone call.

The big unknown now is - Will they experience a subsidy clawback for September, for Both spouses, for the entire year, in other words, did they violate the "once you are eligible"-rule by not pre-enrolling in Medicare online in June-August for September 1.
My first thought would be to try gaming this out with a 2020 tax software package and see what that shows. It can be a bit of a pain, because you have to hack various entries to make it calculate smoothly, but that might give a good clue, though no guarantee.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by CloseEnough »

Good information here, thanks. The high level questions about moving one spouse to Medicare would seem to be fairly common, so it’s unfortunate that it’s so complicated. I guess this could be solved with some advance planning, that is, marrying someone not more than a month or two different in age.
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Re: Moving one spouse from ACA to Medicare (2021 vs 2018)

Post by susa »

In the original post thread it mentioned in part:
Now if you are still on the ACA plan after your birthday month then you will get a nasty surprise from the IRS when you file your taxes the following year because now you will owe back all that money that the government paid the insurance company for your premium subsidy.
If that is indeed correct, then our example individual should not have anything to worry about - because she is NOT on the ACA plan effective today, October 1, 2021 - it was cancelled on her 65th birthday month September 2021.

The other way to look at this is (perhaps this is incorrect ?) - even if there was/is some clawback of the subsidy, the couple earned/will earn only about 24,000 from a tIRA to Roth conversion, No W2, No Interest, No Pension income. They do not qualify (State rule) for Medicaid and have used correctly the Marketplace/ACA to maintain health insurance with a subsidy for several years. At tax time in Spring of 2022 and if online 1040 filing were to show they owed back on the subsidy, should it not then automatically reconcile against their true income and it should be a wash (nothing gained, nothing more earned, no penalty).
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