Financial Assistance in the Marketplace

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Financial Assistance in the Health Insurance Marketplace

Tax Credits and Cost Sharing Reductions

Getting federal financial assistance, also known as federal aid, depends on your household size and income. If you qualify, you may be able to get a plan at a lower cost. These are health plans that come with extra financial help from the federal government. Here are some key things to know about federal aid:

Find out if you're eligible

Depending on your household size and income, you may qualify for this assistance. People age 26 and older, even students, who file their own federal taxes, may be able to get both types of aid. People who don’t have a job and don't have COBRA coverage may also be able to get one or both types of aid. Native Americans and Alaskan natives may also be able to get help with their Marketplace or Tribal health plan.

There are two kinds of help

There are two ways you may be able to save money on your health care plan. One way is by getting a premium tax credit. The other is by getting a cost sharing reduction (CSR). Premium tax credits and cost sharing reductions are types of federal financial assistance1 given to people who qualify in order to help make health insurance more affordable.

Premium tax credits lower your health care premiums

Premium tax credits lower your monthly health care plan premiums. You have two choices for the way you use this aid. After you sign up for your plan, you can have the federal government pay the tax credit right to the insurance carrier each month. This lowers the premium amount you pay. Your other choice is to get a tax credit when you file your federal income taxes. This means you pay the full amount of your insurance premium each month. Then you get the total credit after you file your taxes. You can use the premium tax credit toward any qualified health plan on the Marketplace.

Cost sharing reductions lower your other costs

Cost sharing reductions lower the amount you have to pay out of pocket when you get care, costs like deductibles, copayments and coinsurance. To take advantage of these savings, you must qualify and enroll in a Marketplace Silver qualified health plan. There is no option to get cost sharing reductions by filing a year-end tax return. If you qualify for this type of aid, you pay less out of pocket for things like deductibles, copayments, and coinsurance when you get care.

Federal health care aid at a glance

  Premium Tax Credit Cost Sharing Reduction
Am I eligible? You may be eligible if:
  • You make up to 400% of the Federal poverty level2 ($98,400 for a family of four in 2017)
  • You're not able to get Medicaid or other pubic health care programs
  • You're not eligible for other coverage, like employer-based coverage
You may be eligible if:
  • You make up to 250% of the Federal poverty level ($61,500 for a family of four in 2017)
  • You're not able to get Medicaid or other public health care programs
  • You're not eligible for other coverage, like employer-based coverage
Where can I use it? Any qualified Marketplace health plan Only on Silver-level qualified Marketplace health plans
How much can I get? Varies based on the number of people in your house and how much they make Varies based on the number of people in your house and how much they make
How does it work?
  • Lowers the cost of your premium each month
  • Can be paid each month by the federal government to your insurer
  • Or you can get credit when you file your federal income taxes
  • Lowers the amount you pay out-of-pocket for copays, deductibles and coinsurance

Find out if you can get federal aid

You may be able to get both a premium tax credit and a cost sharing reduction. You can find out what you’re eligible for when you apply on the Marketplace and get your results. The application asks for info, including household size and income. You can save your online application as you go.