My employer offers health benefits to me and my family. The company pays the entire cost of my coverage but contributes nothing toward the cost of covering my family. We can’t afford to enroll my spouse and kids. Can they get coverage and subsidies in the Marketplace instead?
You can always shop for health coverage in the Marketplace. However, your employer-provided coverage is considered “affordable.” That’s because the affordability of employer sponsored coverage is only measured with respect to self-only coverage. Because your employer pays the entire cost of the employee-only coverage, you are technically considered to have affordable coverage (even though practically speaking, it was unaffordable to you.) As a result, neither you nor your spouse and children are eligible to apply for premium tax credits in the Marketplace. Sometimes this rule is referred to as “the family glitch.”
There are a few other things you should know. First, depending on your family income, your children might qualify for the Children’s Health Insurance Program in your state. Check with your state Marketplace to find out if your children may be eligible for CHIP.
Second, if the amount you would have had to pay to actually cover your spouse and kids is more than 8.05% of your family income in 2018, they won’t be penalized for not having health coverage that year.