Household Income and You: Do you qualify for savings?
I have this same conversation several times a day.
A prospective client will call in and ask for a quote for health insurance. Health insurance is a complicated field, and quotes depend on many factors such as age, family size, and household income. Right away, I will ask the client for the vital information I need in helping to assist with insurance policies, but there is one detail that sets the tone for purchasing affordable health insurance.
This detail is Household Income.
I will ask the prospective client, “What is the total annual household income for you/your family in 2016?” It is the responses to these questions that guide the conversation in a progressive or regressive direction.
I am able to save many people hundreds of dollars on monthly health insurance premiums. For instance, a single person in their 20s that earns $20,000 annually will qualify in hundreds in savings on monthly insurance premiums coming from the federal government—he might even qualify for free insurance. In addition, a family earning $75,000 annually will qualify for hundreds of dollars in savings in health insurance premiums every month. The federal government uses a determination factor called the Federal Poverty Level to determine a single person’s or a family’s need. Single taxpayers or multi-person tax households that earn within 100% and 400% of the Federal Poverty Level qualify for tax credits.
I will say that I am able to save hundreds of dollars for clients 70% of the time. I would like this number to be 100%, but we are not in the business of helping everybody save money on health insurance premiums. Individuals and families must earn a minimum income in order to qualify for reductions in monthly premiums.
A single individual in his 40s earning $7,000 will not earn enough money to qualify for tax credits. That same individual would earn hundreds of dollars in tax credits if he makes $11,770 annually. A family of six people with an annual income of $30,000 will not earn tax credits to reduce monthly premiums, but the same family of six could save hundreds of dollars in health insurance premiums if their earned annual income is $40,000.
I enjoy having this conversation because I love the prospect of saving people money. I have seen how expensive health insurance can be, and it is wonderful to see a government measure to control the costs of private insurance. It makes me think that the United States cares about the financial well being of its citizens. I also like the Affordable Care Act because it is not an entitlement program, for a person making too little money cannot enjoy the benefits of the program. The benefits do not extend to those earning too much income because they are more likely to be in a position to afford health insurance premiums.
Philip Strang is an enrollment specialist at American Exchange, and is a Marketplace Certified Agent/Broker. To contact him with any questions or comments you can email him at firstname.lastname@example.org or call at 1-888-995-1674.