10 Tips on Avoiding Major Health Insurance Traps

UNDERESTIMATING YOUR INCOME TO QUALIFY FOR SUBSIDIES

Certain individuals and families will qualify for government subsidies when purchasing health insurance on their own through health insurance market exchanges (also known as marketplaces). This is also a potential insurance trap, Lopez said, because you need to properly estimate what your income will be for the current year.

It might be tempting to underestimate your income as a way to qualify for subsidies, but Lopez advises against it. “If you got more subsidy help than you really qualified for, you will typically have to pay it back on your tax return,” he said. That could mean paying back some or all of your subsidy.