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Family Glitch Update Related to Health Connector Eligibility

January 5, 2023

Family Glitch fixed: Affordability of employer sponsored insurance (ESI) considers the cost for the entire family due to a new IRS rule.

Previously the affordability of an employer sponsored health plan was based solely on the cost of the plan for the employee and not the whole family. This left many dependents without affordable employer sponsored coverage and unable to access tax credits, or subsidies, through the Health Connector. This issue was often referred to as the “family glitch.” The new rule eliminates the family glitch by considering the cost of a family plan when determining whether an employee’s family has access to affordable coverage. The new IRS rule takes effect for plan year 2023. 

The Health Connector application has been updated to include a new question in the 2023 application about the cost of family coverage offered by an employer. This will change how affordability is calculated for family members who have ESI offered through their spouse or parent’s employer and determine if family members qualify for subsidies if their ESI is unaffordable. More applicants and members will qualify for help paying for Health Connector coverage due to this change. Importantly, there are no changes to the rules about whether the employee has access to affordable coverage. Affordability for an applicant who is offered coverage by their employer will still be based on the lowest-cost self-only plan.

The new question allows the applicant to provide information about the cost of the individual and family premiums, and the Health Connector will use the information provided about the family premium to calculate affordability and make determinations about tax credits. The online application now includes the new question; however, the paper ACA-3 does not currently have this question. It is expected to be included in the next version of the paper ACA-3 in March 2023. 

Certified Assisters should review the Cost of Employer Insurance Job Aid, located in the Learning Management System under Resources, Assister Job Aids and Resources for further instructions about how to complete the new question in the 2023 application.