On March 11th, the American Rescue Plan was enacted by President Biden. I will attempt to make the changes which may impact you, as clear as possible. You can reapply through the Marketplace and increase your premium tax credit/subsidy thereby reducing premiums and change your plan if you choose to do so*. The points I discuss below the chart will begin April 1st and extend until August 15th. Once you submit a new application for premium tax credit/subsidy, you have 30 days to change plans if you choose to do so*.
If you are enrolled in coverage through the Marketplace and these changes would allow you to receive an increased premium tax credit/subsidy and DO NOT make changes, you will receive the extra amount when you file 2021 taxes next year. If you have Off Market Coverage and would be eligible for the premium tax credit/subsidy, you will NOT receive any credit at tax time.
MANY CHANGES ARE BASED ON YOU AND YOUR FAMILY INCOME:
- Income for you or your family, under the 150% income level, should allow you to purchase a Bronze Plan for $0 monthly premium.
- Income for you or your family, under 250% income level should allow you to select a Silver Plan with Cost Share Reduction (CSR). Depending on your income amount, the CSR may reduce the plan deductible, copay/coinsurance, and/or maximum out of pocket. The lower the income the greater the reduction. Though the CSR can reduce several benefit cost sharing areas of your plan, I use the deductible to illustrate.
EXAMPLE: Base Plan with no CSR $4300 individual deductible
If income is: <150% the individual deductible is $500 <200% = $1,400 <250%= $3,750
- For 2021 & 2022 any income under 400% will receive an increased premium tax credit/subsidy, thus lower monthly premium. As in the years past a premium tax credit/subsidy can be applied to any plan.
- + Changes may allow individuals making over the 400% cap receive a subsidy, if your premiums are greater than 8.5% of your Modified Adjusted Gross Income (MAGI) . To be eligible you must enroll into coverage through the Marketplace.*
Use the link below to determine if you are eligible for a subsidy:
- IF you receive your coverage through a marketplace plan and you DO NOT reapply, when you file 2021 taxes next year you will receive any increased tax credit/subsidy not paid to the carrier during the year.
- If your income was higher in 2020 than estimated, the ARP is waving any premium tax credit/subsidy you were required to return. NOTE this is for 2020 tax returns only.
UNEMPLOYED IN 2021
You can apply for coverage or change plans through August 15th*. Beginning July or August 1, 2021, (I have heard 2 dates so I am uncertain at this point) anyone unemployed during any of 2021 and YOU HAVE RECEIVED AT LEAST ONE WEEK OF UNEMPLOYMENT BENEFITS, you can once again reapply through the Marketplace and receive an additional subsidy for coverage. For the remainder of 2021 they will cap your income at 133% of the chart above, which means for 2021 you can possibly get a Silver plan for $0 premium- based on the second lowest Silver premium in your county. So you can apply now and possibly receive a subsidy, then reapply in July/August for a great subsidy#.
In the past in GA & SC you were required to earn at least 100% of the Federal Poverty Level in order to receive a premium tax credit/subsidy- I am uncertain at this time if the ARP has changed that requirement.
COBRA COVERAGE
Anyone who has COBRA due to involuntary being released by an employer will have their COBRA premiums paid for the months of April through September. We were told how this is paid for you depends on the type of employer coverage you were offered. The premium will be paid to the carrier or employer on your behalf. NOTE as of now you can only leave COBRA and apply for Marketplace coverage when your COBRA ends or during the Open Enrollment Period, 11/01-12/15*#.
*IF YOU CHANGE PLANS/CARRIERS any charges you paid toward the deductible may NOT transfer to the new plan.
# At any point you are offered employer group health benefits you are required to contact the Marketplace and will no longer be eligible for a premium tax credit/subsidy.
Currently these changes are for 2021 and 2022
TERMS & GENERAL COMMENTS
Premium tax credit/Subsidy- reduces the monthly premiums for insurance plans. With your authorization, the Federal Government pays the subsidy amount to the carrier on your behalf. When you file taxes, they reconcile the subsidy amount verses actual income. You may have to pay back if income was higher, or receive more subsidy if income was less. For purposes of the Premium Tax Credit, household income is defined as the Modified Adjusted Gross Income (MAGI) of the taxpayer, spouse, and children. The MAGI include income sources such as wages, unemployment, foreign income, interest, dividends, and Social Security.
Certain rules to receive a premium tax credit/subsidy have not changed including you cannot be offered group coverage by your or spouse employer; if married you must file a joint tax return.
At any point you are offered employer group health benefits you are required to contact the Marketplace and will no longer be eligible for a premium tax credit/subsidy.
You are required to notify the Marketplace concerning any change in household or income.