This article covers how an offer of employer-sponsored coverage and a Medicaid or CHIP denial affects a consumer's eligibility for Marketplace enrollment, Special Enrollment Periods, and financial assistance.
Key Terms
Key Terms
Employer-Sponsored Coverage (ESC): Health coverage offered to an employee through their employer. An offer of ESC can affect a consumer's eligibility for Marketplace financial assistance if the ESC is considered affordable and provides minimum value.
Minimum value: A standard set by the ACA requiring that an employer-sponsored health plan pay at least 60% of the total allowed cost of benefits. A plan that does not meet minimum value does not disqualify a consumer from receiving Marketplace financial assistance.
Special Enrollment Period (SEP): A time outside of Open Enrollment when a consumer can enroll in or change their Marketplace coverage due to a qualifying life event or other specific circumstances.
Advance Payments of the Premium Tax Credit (APTC): Federal financial assistance paid directly to a consumer's insurance carrier to reduce their monthly Marketplace premium. APTC eligibility is based on projected household income and other factors.
Cost-sharing reductions (CSRs): Discounts that lower the amount a consumer pays out of pocket for deductibles, copayments, and coinsurance on a silver Marketplace plan. CSR eligibility is based on household income.
Medicaid/CHIP denial SEP: A Special Enrollment Period available to consumers who were referred to their state Medicaid or CHIP agency by the Marketplace and were ultimately found ineligible for Medicaid or CHIP outside of Open Enrollment.
If a consumer is found not eligible for Medicaid or CHIP and has an offer of employer-sponsored coverage, can they still enroll in a Marketplace plan and receive financial assistance?
It depends. Having an offer of employer-sponsored coverage does not affect a consumer's eligibility to enroll through the Marketplace or access a Special Enrollment Period (SEP), but it can affect their eligibility for financial assistance.
A SEP exists specifically for consumers who have been denied Medicaid or CHIP coverage. To qualify for the Medicaid/CHIP denial SEP, the consumer must meet all of the following conditions:
They initially applied for Marketplace coverage during Open Enrollment or through a SEP due to a Qualifying Life Event (QLE), such as a move.
They were referred to their state Medicaid/CHIP agency because the Marketplace found them potentially eligible for Medicaid or CHIP.
They were ultimately determined ineligible for Medicaid or CHIP by the state agency outside of Open Enrollment or the SEP.
They are otherwise eligible for Marketplace coverage.
If the consumer qualifies for the Medicaid/CHIP denial SEP, they have 60 days from the date of the Medicaid or CHIP denial to enroll in Marketplace coverage. Coverage starts on the first day of the month after the consumer selects a plan. For example, if a consumer selects a plan on November 16, coverage starts December 1.
The consumer may also call the Marketplace Call Center at 1-800-318-2596 to request retroactive coverage back to the effective date they would have received had the Marketplace originally determined them eligible for qualified health plan (QHP) coverage with financial assistance.
Does an offer of employer-sponsored coverage affect financial assistance eligibility for a consumer who qualifies for the Medicaid/CHIP denial SEP?
Yes. A consumer who qualifies for the Medicaid/CHIP denial SEP but has an offer of employer-sponsored coverage (ESC) does not qualify for APTC or cost-sharing reductions (CSRs) if that ESC is considered affordable and provides minimum value.
In 2026, ESC is considered affordable if the premium the employee must pay for self-only coverage or for family coverage is less than 9.96% of their household income. When a consumer applies for Marketplace coverage, the application will collect the relevant ESC premium amounts to determine whether their ESC is considered affordable.
Consumers whose ESC is not affordable or does not provide minimum value qualify for APTC and CSRs, if otherwise eligible. A consumer also does not qualify for APTC or CSRs if they are currently enrolled in ESC, regardless of whether that ESC is affordable or provides minimum value.
My client does not file taxes jointly with their spouse. Are they eligible for financial assistance through the Marketplace?
Generally, married couples must file taxes jointly to be eligible for Marketplace financial assistance. The IRS considers an individual to be married if they are separated but have not obtained a final decree of divorce or separate maintenance by the last day of the tax year.
However, there are two exceptions where a legally married consumer who does not file taxes jointly may still be eligible for the Premium Tax Credit (PTC) and cost-sharing reductions (CSRs):
Exception 1 — Domestic abuse, domestic violence, or spousal abandonment: If the consumer is legally married and will not file a joint return because they are a victim of domestic abuse, domestic violence, or spousal abandonment, they may enter "single" on their Marketplace application. The consumer and potentially their dependents would then be eligible for PTC and CSRs if they qualify based on income and other factors.
Exception 2 — Head of household filing status: If the consumer is legally married, will not file a joint return, and plans to file using the head of household filing status, they must enter "married" on their Marketplace application. To claim head of household filing status, a consumer generally must live separately from their spouse and live with a child they claim as a dependent. If the consumer attests to being married but not filing jointly and meets the criteria, the Marketplace application will include a question about head of household tax filing status. The consumer should only answer that question affirmatively when IRS rules allow use of that filing status. The consumer would then be eligible for PTC and CSRs if they qualify based on income and other factors.
Additional Resources
If you have any questions please contact Producer Support. Producer Support is available by phone at (866) 568-9649, by email at [email protected], or by chat directly from your MyMFG account.