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Healthcare Exchange Q&A

Can 'underground economy' workers even apply for health exchange insurance?

Published:   |   Updated: November 11, 2013 at 07:50 AM

Q: Most people working in the “underground economy” don’t have bank or savings accounts, live on cash only, and in many cases don’t file income tax returns. How can they get health insurance on the exchange with no conventional financial records? — Thomas from St. Petersburg

Answer: The online Health Insurance Marketplace depends a lot on Internal Revenue Service records to determine how much a person will pay for monthly health premiums. If an individual makes between 100 and 400 percent of the federal poverty level ($11,490 and $45,960), he or she can earn partial subsidies or tax credits toward the premium.

Your question points to an unspoken reality for a lot of low-income workers. When you live paycheck to paycheck, cash is often the easiest and quickest way you can get the money you need to survive. You don’t want or need a bank account when you need every dime you earn as soon as you get it.

Officially, you do not have to report income to the IRS in order to apply for insurance on the health exchange. But other documentation will be required, say a paycheck stub. So I’m not sure what would qualify, meaning folks in the underground economy who really want health coverage may need to look at establishing some form of financial records. And there’s no official statement from the Department of Health and Human Services, which is in charge of the rollout of the new exchange.

It’s an interesting dilemma, as the working poor are usually uninsured and the ones who would most likely benefit from health insurance assistance. These individuals may be among the close to 1 million Floridians who fall into a coverage “gap.” Right now, state residents who make less than $11,490 a year are not eligible for help in the exchange, and are not eligible for Medicaid, the state/federal subsidized health plan.

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