3 Cost assistance types:
- Premium Tax Credits – to lower premiums
- Cost Sharing Reduction Subsidies – to lower out of pocket costs
- Medicaid and CHIP
Some additional FAQ’s
- Cost assistance subsidies are made available only in your states health insurance marketplace. Many health insurance brokers can help you outside the marketplace can help you enroll in a marketplace plan. Medicaid and CHIP are the exceptions since they may be obtained any time in the year and Medicare then has its own open enrollment period.
- Subsidies are based on your income. For most states, anyone can get on Market plans some type of subsidy if making less than 400% of the FPL (Federal Poverty Level)
- Each year the Federal Poverty Level will adjust for inflation, this allows an increased number of Americans who can then qualify for cost assistance.
- There are less tax credits for people making below 400% of the FPL, cost sharing reductions are available for people making less than 250% of FPL on silver plans. Ins states that expanded Medicare and make less than 138% are eligible for Medicaid.
- To determine subsidies is household income modified adjusted gross income or the MAGI; this figure is after most of the deductions have been taken out.
- Qualifying for cost assistance, then a marketplace plan cannot exceed the cost over 9.5% of your current income. That is after any tax credits have been applied. So the lower the cap when you make less.
- The amount of cost assistance available is based on your states Marketplace second lowest cost Silver plans.
- For states that did not expand Medicaid many won’t qualify because they have fallen into the Medicaid gap, not qualifying for Medicaid or subsidies when making less than 100% FPL.
- Silver Plans are the only plans where cost sharing reductions subsidies are made available.
- To lower premiums tax credits may be applied in advance in part or in full or may be adjusted on federal income taxes.