What Does the Affordable Care Act Mean for Single Parents?
The answer depends on whether a single parent is employed (or technically an employer offers affordable health insurance) or not.
Self-employed single parents or those with no access to employer-sponsored health insurance can shop anywhere for coverage.
Experts recommend, however, that single parents start shopping at the marketplace to determine if your income qualifies you for a tax subsidy or if your children qualify for coverage under the federal-state Children’s Health Insurance Program (CHIP) or Medicaid.
Check Your Options
You can find the marketplace at the federal website or, if your state runs its own marketplace, start there (such as in Connecticut, Kentucky, and Washington State). HealthcareACT.com has an interactive map of state-based and federally facilitated marketplaces.
If you have access to employer-provided health insurance, you could face obstacles in the marketplace, according to First Focus, a bipartisan organization that advocates for children and families.
In January, the U.S. Department of the Treasury issued a rule that leaves hundreds of thousands of children without affordable health coverage, First Focus said in a statement.
Known as the “family glitch,” this rule means that if an employer offers employee health insurance coverage and the cost of that coverage does not exceed 9.5% of the taxpayer’s household income, then the coverage is considered affordable for the entire family regardless of its actual cost, First Focus said.
Here’s the problem: The average employee-only coverage costs about $5,400 per year, but the average family coverage costs about $15,000 annually, the organization said.
When coverage is deemed “affordable,” a family can’t access tax subsidies for marketplace coverage, and the only option then may be expensive employer coverage, says Joe Touschner, a senior health policy analyst at the Center for Children and Families at the Georgetown University Health Policy Institute.
Half a Million Children Could Remain Uninsured
Using estimates from the federal Government Accountability Office, First Focus reported that under the family glitch, many parents would be unable to afford coverage, and about 460,000 children would be uninsured. Fixing this glitch would require Congress to revise the rule.
Regardless of how this rule affects you as a single parent, First Focus President Bruce Lesley recommends you use the marketplace to determine if a subsidy is available and if your children could enroll in CHIP.
Every state offers coverage under CHIP, though some states offer coverage at higher income levels than others do.
CHIP, CHIP Away
“If you’re a single parent applying for coverage in the marketplace, that coverage starts at 138% of the federal poverty level,” Lesley explains. “For children, some states provide health coverage when family income is up to 300% of the federal poverty level, although the median family income for CHIP coverage is 250% of the poverty level.”
The U.S. Department of Health & Human Services publishes the HHS Federal Poverty Guidelines, and Touschner suggests using this table to determine the maximum income levels for CHIP in each state.
Medicaid Expansion: Some States Do; Some Don’t
Also keep in mind that many states (though not all) are expanding Medicaid under the Affordable Care Act (ACA) and when they do, more individuals, including many parents, will be eligible for low or no-cost coverage through Medicaid, Touschner says.
To date, the Kaiser Family Foundation lists 39 states and the District of Columbia as moving forward with Medicaid expansion plans.
Before using the marketplace, single parents should collect the information needed to estimate their income in 2020 and any documentation that explains the employer’s offer of coverage, Touschner advises.
Also, before choosing a health plan, parents should confirm that their children’s doctors and hospitals are in the network. Out-of-network providers cost much more than in-network providers do and some plans do not cover out-of-network services at all.
Health plan directories are often out of date, and sometimes physicians and hospitals themselves are unsure about which plans they’re in. Call the plan and providers directly to check.