ACA Marketplace—Often the Best Option
Key Takeaways
Your PROJECTED income determines subsidies, not last year's
Marketplace is often much cheaper than COBRA
Layoff gives you a 60-day special enrollment window
The ACA Marketplace
"I don't qualify for Obamacare—I made too much" — That was last year. This year is different.
Why Marketplace Often Wins
The key insight: subsidies are based on your projected income for THIS year, not last year's taxes.
If you earned $150,000 last year but expect $50,000 this year (severance + unemployment + part of a new salary), your subsidies are based on $50,000.
How Subsidies Work (2025)
| 2025 Federal Poverty Level (Single) | Subsidy Level |
|---|---|
| Up to 150% FPL (~$22,590) | Maximum subsidies |
| 150-200% FPL (~$30,120) | Large subsidies |
| 200-300% FPL (~$45,180) | Moderate subsidies |
| 300-400% FPL (~$60,240) | Small subsidies |
| 400%+ FPL | Subsidies still available (enhanced through 2025) |
⚠️ IMPORTANT: Enhanced ACA subsidies expire December 31, 2025. If Congress doesn't extend them, subsidies above 400% FPL will disappear and costs will increase significantly in 2026.
Example: A family of 4 earning $60,000 projected income might pay $200-400/month for a Silver plan vs. $2,249/month average for family COBRA.
The Special Enrollment Period
Losing job-based coverage is a "qualifying life event" that gives you:
- 60 days to enroll in Marketplace coverage
- Coverage starts the first of the month after enrollment
- You don't have to wait for open enrollment
Plan Types
| Metal Level | Premium | Out-of-Pocket Costs | Best For |
|---|---|---|---|
| Bronze | Lowest | Highest | Healthy, minimal care |
| Silver | Moderate | Moderate | Most people |
| Gold | Higher | Lower | Regular care needs |
| Platinum | Highest | Lowest | High medical needs |
Silver Sweet Spot: If income is 100-250% FPL, Silver plans offer "cost-sharing reductions" that lower deductibles and copays—not just premiums.
How to Estimate Your Projected Income
Add up what you expect to receive this calendar year:
| Income Source | Include? |
|---|---|
| Wages earned so far | Yes |
| Severance pay | Yes (if paid this year) |
| Unemployment benefits | Yes |
| Investment income | Yes |
| Expected new job income | Yes (estimate) |
| Retirement withdrawals | Yes |
Be reasonably accurate. If you underestimate and earn more, you'll owe subsidy repayment at tax time.
What determines your eligibility for ACA Marketplace subsidies?
Your income from the previous year's tax return
Your projected income for the current calendar year
Your highest earning year in the last 5 years
Your income in the month you apply