By Qamar S, 15 years in US medical billing · Last reviewed September 28, 2026
If your job offers health insurance that’s “affordable” and meets minimum value, you can still buy a Marketplace plan, but you won’t get a premium tax credit. For 2027, employer coverage counts as affordable if your share for employee-only coverage is no more than 10.22% of your household income. If it costs more than that, you may qualify for Marketplace savings.
Quick test for 2027: multiply your household income by 10.22%, then divide by 12. If your monthly premium for employee-only coverage at work is more than that number, the offer is unaffordable and you can shop for a subsidized Marketplace plan.
Example
| Household income | 10.22% per year | Affordable if employee-only premium is at or below |
|---|---|---|
| $40,000 | $4,088 | $341 a month |
| $60,000 | $6,132 | $511 a month |
| $80,000 | $8,176 | $681 a month |
What about my spouse and kids?
Since 2023, family members are judged separately. Their offer is affordable only if family coverage costs no more than 10.22% of household income. So even if your own coverage is affordable, your spouse and children may qualify for Marketplace tax credits when the family premium is too high. (This change fixed what used to be called the “family glitch.”)
Employer plan vs Marketplace plan
| Employer plan | Marketplace plan | |
|---|---|---|
| Premium | Employer usually pays a big share, taken pre-tax from your paycheck | You pay it, minus any tax credit you qualify for |
| Tax credit | Not available with an affordable offer | Based on income, if you don’t have an affordable offer |
| Networks | Often broader PPO options | Often narrower HMO or EPO networks |
| Enrollment | Your employer’s open enrollment, usually in the fall | November 1 to January 15 (Dec 15 for Jan 1 start) |
| Changes | Mid-year changes only with a qualifying event | Update income any time; plan changes need an SEP |
How to decide
- Get your employer’s numbers: the monthly cost for employee-only and family coverage, deductible and out-of-pocket maximum.
- Run the affordability test above for you and, separately, for your family.
- Compare total yearly cost: premiums plus what you’d pay in a typical and a bad year. Our health plan cost comparison calculator does the math.
- Check networks for your doctors and hospital.
- Remember the tax break: employer premiums are usually taken out before tax, which lowers their real cost.
From 15 years in billing: if you drop employer coverage mid-year to switch, get the exact end date in writing. The most painful bills I’ve seen come from a gap of a few days between two plans, often right around an ER visit.
Sources: Mercer: 2027 affordability percentage · HealthCare.gov: Job-based coverage and the Marketplace · IRS: Premium tax credit eligibility
This guide is educational and is not legal, financial or insurance advice. See our Disclaimer.