General Discussion
In reply to the discussion: How an additional $1,000 in income can cost you $6,420 more in premiums in CA [View all]ProSense
(116,464 posts)"That doesn't explain what you say about premium caps Why doesn't the calculator reflect premium caps, in your opinion?
The difference between 'earnings' and 'modified adjusted gross income' is a different matter. It depends largely on how much they pay into an IRA, as far as I can tell. But that has absolutely nothing to do with premium caps; can we stay on the question?"
...you are ignoring a big factor that will affect the actual premium of the couple in the OP scenario, which is the MAGI.
As for premium caps, the calculators do not address employer plans. Still, if an indiviual's employer doesn't offer affordable coverage, the person may be eligible to shop the exchange. Now what happens in that scenario?
From the link in the OP, scroll down to where it states methodology:
Californians who are U.S. citizens or lawful residents will be eligible to purchase coverage through Covered California beginning in 2014 if they are not eligible for a federal program such as Medicare or Medi-Cal, and do not have an offer of affordable coverage through their employer or a family member's employer. Employer-sponsored plans will be considered unaffordable if the employee contribution for employee-only coverage is more than 9.5 percent of household income or if the plan has an actuarial value of less than 60 percent.
Estimated premiums without subsidies reflect the statewide average second most affordable silver plan premium based on Covered California Health Plan and Rates for 2014 (May 23, 2013). Age-adjusted premiums for each household member who would enroll in coverage are aggregated into a family premium, using the methodology outlined in final federal regulations released in February 2013.
For individuals with household income below 400 percent FPL who purchase coverage through Covered California, the law limits individuals' premium contributions to a set percentage of household income. If the monthly premium without subsidies is less than the maximum premium contribution, the household will pay the premium without subsidy. The premium caps range from 3.0 percent of income at 133 percent FPL to 9.5 percent of income at 300 through 400 percent FPL. The premium percentage cap will be 2.0 percent for households with income below 133 percent FPL, applicable to legal immigrants who are not eligible for Medi-Cal. This cap is not shown in the calculator as most individuals with income below 133 percent FPL will be eligible for Medi-Cal. The calculator uses 2013 FPLs, which will be used by the Exchange during the open enrollment period for the 2014 plan year.