This week, I answered questions from readers who were up in arms about having to repay premium tax credits or wait for insurer approval to fill a prescription. Another woman wanted details about the timing for switching from her Obamacare plan to her new husband鈥檚 employer plan after she gets married this summer.
Q: When I applied on the exchange for health insurance I had to predict my income. I submitted four paycheck stubs so they could figure out how much premium tax credit I qualified for. But they figured it incorrectly and now I have to repay $8,000 to the Internal Revenue Service.聽It was their error, but I鈥檓 told they鈥檙e not responsible. Is that legal?
A. It is. When you apply for a marketplace plan, your premium tax credit is based on your own and the marketplace鈥檚 best estimate of your income for the upcoming year, using tax records and other available electronic data, or sometimes pay stubs as in your case.
Especially for people who have multiple sources of income or whose income is variable, 鈥渢he projections are difficult鈥澛燼nd verifying them 鈥渃an be tricky for the marketplace,鈥澛爏aid Tara Straw, a senior policy analyst at the Center on Budget and Policy Priorities.
Even so, it鈥檚 your responsibility to keep the marketplace informed if during the year your income is higher than expected so that the tax credit you鈥檙e receiving can be adjusted downward and you don鈥檛 get blindsided with a big bill at tax time. For most people who receive too much in subsidies, 聽between $300 and $2,500, depending on the person鈥檚聽income and tax filing status.聽However, there鈥檚 no repayment cap for people whose income is above 400 percent of the federal poverty level (about $47,000). Unfortunately, it appears you fall into this category.
Q. I have a Medicare prescription drug plan with a $300 deductible. I don鈥檛 need many prescriptions, but the drugs I do need require prior authorization, meaning they make you wait three days after the doctor calls in the prescription to decide if they are going to cover it. This is true even for my routine drugs.聽My pharmacist says insurers are doing this more and more. Is that true?
A. Your pharmacist鈥檚 impression is correct. The number of drugs for which insurers require prior authorization in Medicare stand-alone drug plans has been inching up for years, according to the Medicare Payment Advisory Commission. In 2016, that were listed in Medicare drug plan formularies required the insurer鈥檚 OK before they could be dispensed, up from 23 percent the year before.
Insurers use other strategies to control drug spending as well, but prior authorization is the most prevalent. They may limit the number of doses of a drug that can be provided over a set period of time, for example, or require patients to try a cheaper drug in the same category before approving a more expensive one. Overall, the number of drugs that have some sort of 鈥渦tilization management鈥� requirement, as it鈥檚 called, has more than doubled since 2007, to 41 percent.
What the numbers don鈥檛 tell us is how utilization management affects patient care, said Juliette Cubanski, associate director of the Program on Medicare Policy at the Kaiser Family Foundation. (KHN is an editorially independent program of the foundation.)
鈥淎re people able to get the drugs they were prescribed or are they able to get a medically acceptable substitute?鈥� she asked. 鈥淲e don鈥檛 know that.鈥�
Q. I plan to get married in June. I am currently enrolled in an Obamacare plan. Can I switch to my husband鈥檚 employer coverage right away after the wedding or do I have to wait until the next open enrollment period in the fall?
A. You can switch right after the wedding. Marriage is one of several life-changing events that create a window of opportunity for people to change health plans, whether they鈥檙e covered on the health insurance exchange or by an employer. Other events include divorce and the birth or adoption of a child.
It鈥檚 a good idea for your fianc茅 to notify his employer about the impending change before the wedding so the company can process it and you can avoid a gap in coverage, said Tracy Watts, a senior partner at benefits consultant Mercer. That way, your new coverage can start on the first day of the month following your wedding date. You鈥檒l need to inform your current plan that you鈥檙e dropping that coverage on a certain date as well, of course.
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