Liz Weston: Unemployed during 2021? You qualify for a premium-free health plan through the ACA

Dear Liz, my husband has lost his job and we are in the COBRA insurance of our health insurance. Thanks to the American rescue plan passed in March, we won’t have to pay the premiums until September 30th. Is there anything we can use from October 1st if my husband doesn’t go back to work?

As far as I know, there is currently a special filing deadline for Affordable Care Act cover that ends August 15th. My husband’s 18 month COBRA coverage ends in December, but it’s very expensive and we want something cheaper.

Answer: Both of you should be able to switch to an Affordable Care Act policy once your free COBRA insurance ends.

COBRA allows people to extend their company health insurance for up to 18 months after losing their job, but as you’ve noticed, the cost can be high. COBRA coverage requires payment of the entire premium that was once subsidized by the employer, plus an administration fee. In contrast, ACA policies are typically subsidized with tax credits that make insurance coverage more affordable.

The American Rescue Plan requires employers to pay COBRA awards for eligible former employees from April through September. Employers are refunded through a tax credit. (The grant can last less than six months if a person’s COBRA eligibility ends before September, or if they are eligible for group insurance through their job or their spouse’s work.) When the premium-free insurance ends, your husband would be eligible for a special benefit Registration period that allows him to switch to an Affordable Care Act policy.

In addition, anyone who is unemployed at any point in 2021 is entitled to premium-free full insurance through the ACA for the remainder of the year. HealthCare.gov will announce details later this month.

Dear Liz: I have a credit score of 780 but I noticed that one of my cards is not counting towards the credit used percentage. I’ve had this card for 44 years and I could ask for a few hundred thousand dollars for a single purchase if I wanted to, but credit score formulas don’t count towards Amex’s “credit I have”. Seems unfair?

Answer: Since six-digit credit cards are rare, what you are describing is likely a charge card. Unlike credit cards, charging cards do not have pre-set spending limits. They also usually don’t allow you to carry a credit month to month.

The “percentage of credit used” you mentioned is known as the credit utilization and is an important factor in credit rating formulas. Loan Utilization measures how much of your available credit you are using, and the bigger the gap between your credit limit and your balance, the better.

But the credit utilization calculation cannot be done if one of the numbers – the credit limit – is missing. The only way the formulas can calculate loan utilization in this case is to assume that the amount you calculated is within your credit limit and that would be catastrophic to your results.

Liz Weston, Certified Financial Planner, is a personal finance columnist for NerdWallet. Questions can be directed to them at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or via the “Contact Us” form at asklizweston.com.

source https://dailyhealthynews.ca/liz-weston-unemployed-during-2021-you-qualify-for-a-premium-free-health-plan-through-the-aca/