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Are you eligible for ACA subsidies?

Many people who purchase health insurance are eligible to receive an ACA subsidy under the Affordable Care Act health insurance policies from the federal or state exchanges.

However, who benefits and is able to reduce the cost of monthly premiums?

Well, almost everything is based on the Federal Poverty Level (FPL).

Indeed, each year the US Department of Health and Human Services (HHS) updates the information and issues the FPL.

Based on the FLP, eligibility criteria are determined for certain programs, including ACA (Affordable Care Act or Omabacare) coverage.

People who choose Obamacare are generally low- and middle-income people, people with pre-existing conditions, and pregnant women.

Each year, both the date for open enrollment and the requirements may vary.

For example, for 2022, the enrollment period begins on November 1, 2021 and runs through January 15, 2022, in most states.

If you prefer to have more information, contact us, and we will provide you with complete free advice.

Requirements for ACA subsidy 2022

In general, the minimum requirements to qualify for ACA subsidy in 2022 are as follows:

  1. Have a legal immigration status in the United States and have a Social Security number.
  2. You must not have health insurance through your employer in which your employer pays 60% or more of your average health care costs with a comprehensive, “affordable” coverage plan, plus your share of the costs. Premiums do not exceed 9.83% of your home.
  3. Have a minimum annual income of 100 of the federal poverty level.
  4. If you are married, you need to file a joint tax return.
  5. Not be eligible for coverage through Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), or other forms of public assistance.
  6. Must not be dependent on another person.
  7. You must report your income in order to determine the amount of the ACA subsidy.
  8. Enroll in the enrollment period established by the federal government for subsidized health plans (unless you qualify for a special period).
  9. Must not be incarcerated.

Types of Plans

 

There are 4 levels of coverage: bronze, silver, gold, and platinum.

Basically, bronze plans tend to have the lowest premiums, but the highest deductibles in addition to other cost-sharing. For this reason, the member pays more out of pocket when receiving covered health care services.

Platinum plans have the highest premiums but the lowest cost.

It is important to note that the premium tax credit can be applied to plans at any of these 4 tiers.

Additionally, catastrophic health plans are offered in which tax credits cannot be applied. They are plans with lower premiums and higher cost-sharing than bronze plans. Mainly, catastrophic plans are available to people under the age of 30.

What is the minimum income to qualify for ACA subsidy or premium tax credit?

The minimum income is defined as the Modified Adjusted Gross Income (MAGI). To perform the calculation, the sources of income of the taxpayer, spouse, and dependents must be included. Sources of income to consider include wages, salaries, foreign income, interest, dividends, and Social Security.

Certainly, your eligibility for ACA subsidy under the Affordable Care Act depends on your income, however, for 2021 and 2022, there is no longer an income limit at 400% FPL:

“If your income is over 400% of the FPL, you can now qualify for the tax credit that lowers your monthly premium for a Marketplace 2021 health plan.”

Source: HealthCare.gov

Contradictory as it may seem, if your income is less than 100% of the FPL, you may not be eligible for the premium tax credit.

For 2022, income to apply for subsidized health insurance is based on the 2021 Federal Poverty Guidelines:

  • For a single person: Income from $12,880 (100%) to $51,520 (400%).
  • For families of 2: Income from $17,420 (100%) to $69,680 (400%).
  • For families of 3: Income from $21,960 (100%) to $87,840 (400%).
  • For families of 4: Income from $26,500 (100%) to $106,000 (400%).
  • For families of 5 people: Income from $31,040 (100%) to $124,160 (400%).
  • For families with more than 8 people: Add $4,540 for each additional person.

 

Note 1: Family size is defined as everyone on your tax return. Generally, it is made up of you, your spouse, and your children under the age of 26.

 

Note: For Alaska and Hawaii states, there are more stringent guidelines.


For more information, you can consult the ASPE “Poverty Guidelines web page.

Final words

ACA subsidies help you get more affordable insurance and increase protective coverage. Its purpose is to help those most in need by achieving more affordable health plans.

If you need more information, contact us and our experts will be happy to advise you and help you select the coverage that best suits your needs.

This Post Has One Comment

  1. Thomas Taylor

    thanks for the info Veneville

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