Earning Just Over the Tax Credit Limit? 5 Ways to Lower Your 2027 Premium

If you buy your own health insurance and your income is just over the limit for tax credits, 2027 premiums can feel brutal. You earn a little too much for help, but not nearly enough to shrug off paying full price.

Here’s the frustrating part: it’s a cliff, not a slope. Earn $1 under the limit and you may get thousands in tax credits. Earn $1 over and you get nothing.

For 2027 coverage, the limit is 400% of the Federal Poverty Level:

If you’re over that line, you still have options. Here are five ways to bring your 2027 costs down.

1. Lower the Income That Counts

Tax credits aren’t based on your paycheck. They’re based on your modified adjusted gross income, which is roughly your income after certain pre-tax deductions. Some of those deductions are completely in your control:

• Pre-tax retirement contributions through work, like a 401(k) or 403(b)
• Traditional IRA contributions, if they’re deductible for you
• SEP-IRA or solo 401(k) contributions, if you’re self-employed
• HSA contributions (more on that in #2)

Here’s how that can play out. Say a family of four expects to earn $135,000 in 2027. That’s $3,000 over the limit, so they’d get no tax credits. If they put $5,000 into pre-tax retirement accounts, their countable income drops to $130,000. Now they’re under the line and may qualify for tax credits, while also saving for retirement.

This takes planning. Your tax credits are based on your estimate, so set up the contributions you’ll actually make. If you end the year over the limit, you’ll have to pay back every dollar of tax credits you received. Talk to your tax professional about what makes sense for you.

2. Choose a Bronze Plan and Use the HSA

Bronze plans have the lowest premiums on the Marketplace. And new this year, every Bronze plan on Connect for Health Colorado can be paired with a Health Savings Account (HSA).

That’s a double win for people near the cliff:

• You pay a lower premium every month.
• Your HSA contributions lower your countable income, which can help you get under the limit, like the retirement contributions in #1.

The money in your HSA grows tax-free and comes out tax-free for medical costs, so it becomes your fund for the higher Bronze deductible. Our post on HSA tax advantages walks through the math.

Best for: healthy households who don’t expect much care next year.

3. Consider a Health Share

Health shares are memberships where members share each other’s medical costs. For healthy households paying full price on the Marketplace, the monthly cost is often noticeably lower.

But it’s important to know what you’re giving up. Health shares aren’t insurance:

• They don’t guarantee they’ll pay a bill.
• They can limit or exclude pre-existing conditions.
• Many have waiting periods or limits for pregnancy.
• You can’t use tax credits with them, and they don’t have to follow Marketplace rules.

Best for: healthy individuals and families over the income limit who are comfortable with those trade-offs. Not a fit if you’re planning a baby or anyone in your household has an ongoing condition.

4. Pair a Lower-Premium With Fixed Indemnity

The catch with a cheap Bronze plan is the high deductible. A fixed indemnity plan can help fill that gap.

Fixed indemnity plans pay you a set dollar amount when something covered happens, no matter what the bill is. For example, a plan might pay a flat amount for each day you spend in the hospital or each doctor visit. You can use that money however you want, including toward your deductible.

Put together, you get:

• A lower monthly premium from the Bronze plan
• Full Marketplace protection, including the out-of-pocket max, for a big medical year
• Cash from the fixed indemnity plan to soften the deductible when you need care

Fixed indemnity isn’t full health insurance on its own, so it works best as a sidekick to a Marketplace plan, not a replacement.

Best for: people who want a low premium but worry about paying a big deductible all at once.

5. Compare Every Option, Not Just Last Year’s Plan

When you’re paying full price, the gap between plans adds up fast. A few things worth checking:

• Every insurance company in your county. Colorado has six companies selling individual plans for 2027, including Colorado Access, which is new this year. The same metal level can cost very different amounts from company to company.
• Colorado Option plans. These have the same costs at every company and cover many services before the deductible, which can help if you use regular care.
• Job-based coverage. If you or your spouse can get insurance through work, compare it. It may cost less than a full-price Marketplace plan.

Don’t just renew because it’s easy. If you were auto-renewed, your 2027 price may be very different from what you paid this year.

The bottom line

If you’re just over the limit, don’t assume full price is your only choice. You may be able to lower your income enough to qualify for help, cut your premium with a Bronze plan and HSA, or save with a health share or a fixed indemnity pairing.

This is our specialty. We’ll run the numbers on every option, Marketplace, health shares and fixed indemnity, and show you the full-year cost of each before you enroll. Open Enrollment runs Nov. 1 to Jan. 15, and you need to enroll by Dec. 15 for coverage that starts Jan. 1.

Book a free call or call 303-225-0073. It’s always free to work with us.