Question: If a consumer overestimates their income in order to stay out of Medi-Cal and when they file their taxes it is determined they should have had/qualified for Medi-Cal, is the consumer penalized? Or what happens?
Answer: The consumer is liable for repayment of any excess tax credit received in the year. In your scenario, that would be the entire annual subsidy. However the amount of the”clawback” provision is limited by the household income according to the ACA law. If the household income (expressed as a percent of poverty line) is :
- Less than 200%, the amount of the clawback is limited to one-half of $600
- At least 200% but less than 300%, the amount of the clawback is limited to one-half of $1,500
- At least 300% but less than 400%, the amount of the clawback is limited to one-half of $2,500.