familybusinessseniormembercontactblogtonik
Health Insurance and Health Reform Blog
 
spacer
blue top
HomeHealth Insurance Blog › Healthcare Exchange Cost-Sharing Subsidies: What You Need to Know

Healthcare Exchange Cost-Sharing Subsidies: What You Need to Know

October 17, 2014

By Amy De Vore+

The Affordable Care Act, commonly known as ObamaCare, offers two types of subsidies. Most Americans understand that the government may help pay some of the costs but are still unclear about how the program works.  1)Federal Premium Subsidies and 2) Federal Cost-Sharing Subsidies. This article is dedicated to Cost-Sharing Subsidies. To learn about the other form of subsidy, read Do I Qualify for Premium Subsidies?

healthcare-exchange-costsharing

What are Cost-Sharing Subsidies?

Cost-sharing Subsidies (which are also called Cost Sharing Reductions) are when the government helps pay the costs of deductibles, co-insurance, co-payments or similar charges. Cost-sharing reductions lower these costs for an individual or family enrolled in a qualifying health plan through the Healthcare Exchange. Cost sharing subsidies do NOT include premiums, or non-network providers or billing.

Which Exchange Plans Qualify for Reductions?

Only individual and family Silver plans qualify for cost-sharing subsidies. The reason for this is the government wants to be able to help low to moderate income families afford more comprehensive coverage. To learn more about the Silver Plan visit our Silver Plan Page or contact 800-930-7956.

What is the Max I Can Make to Qualify for Cost-Sharing?

The law states that individuals making less than 250% of the federal poverty line (FPL) can qualify for cost-sharing. The current FPL is $11,670 for individuals, so someone making about $29,175 or less may qualify for cost-sharing subsidies.

How do the Cost-Sharing Subsidies Breakdown?

The Silver plan is set up so that 70% of medical costs are covered through the provider. With cost-sharing subsidies the amount listed below is what the provider and the government will approximately pay for your out-of-pocket health services:

  • If your income is 100-150% of the FPL, the actual coverage of a Silver plan is 94%
  • If your income is 150-200% of the FPL, the actual coverage of a Silver plan is 87%
  • If your income is 200-250% of the FPL, the actual coverage of a Silver plan is 73%

The amount you have to pay with cost-sharing is anywhere from 6-27% of actual cost of plan rather than the normal 30% if you don’t qualify for cost-sharing.

UPDATE 11/27/13: For an easy way to fill out your ObamaCare application go to Healthapplication.com. Remember to fill it out and send it in as soon as possible to ensure the earliest enrollment date.

Further Questions
If you have any further questions about cost-sharing and whether you qualify please contact Medicoverage. If you know you qualify and are ready to fill out an application go to Healthapplication.com.

Open enrollment for new health coverage begins Nov 15, 2014. Applications must be submitted before Feb 15,2015. Apply for an ACA Plan Here

DAYS LEFT UNTIL OPEN ENROLLMENT BEGINS. Apply Now




Comments for Healthcare Exchange Cost-Sharing Subsidies: What You Need to Know

By David Roper on July 02, 2013

For those above 250% of FPL who do not qualify for cost sharing subsidies, the actuarial level of the plan does not guarantee that they will pay exactly the percentage of health costs specified by the metal level plan they choose.  But the cost sharing subsidies that are specified for those below 250% of FPL appear to require that the individual’s plan (not only the broad range of all plans in that plan tier)must pay a specific percentage of medical costs for that individual. 

Is that correct?


By Steve on September 08, 2013

Hi,
I’m a young individual that made about $10k last year. What I’m worried about is the $2k medical deductible. Will the subsidy help me with the medical deductible or will it only help with regard to the cost of monthly premiums?
Thank You

MEDICOVERAGE AGENT RESPONSE
Steve,
Thank you so much for your comment. Since you made less than $11,490 you do not qualify for subsidies, however you may qualify for Medicaid -if your state expanded its coverage. If you had made between $11,490 and $28,725 you may qualify for both help with your premium and help with your deductible, as well as copays and coinsurance.

So if your income will go up this year you can lock in one of these new plans with possible assistance.
-Chris


By Dennis on September 28, 2013

So…I live in Southern California. I’ll make about 15,000 this year. Will be about the same next year. I am looking at deductible and copay chart. How does the cost sharing subsidy help me pay these? Or does it? What happens in the doctor’s office when they ask me for my copay amount? How much am I obligated for? Or what happens if they ask me for the rest of the bill because I may not have met my deductible for the year? How do they know what my deductible status is at that moment?

Thanks

Dennis

MEDICOVERAGE AGENT RESPONSE

Dennis,
Thank you so much for writing to us. With your approximate take home you would more than likely qualify for Medi-Cal. If your salary pushes you above the Medi-Cal eligibility you should qualify for cost-sharing subsidies to help with deductibles, coinsurance, and copays -basically to help when you seek medical care. As well as you should qualify for premium subsidies to help with your monthly costs. Call 800-930-7956 to find out exactly what you qualify for.

-Chris from Medicoverage.com


By kirsten a smith on October 15, 2013

As an individual earning $16,600 a year, why can I not enroll in Silver 94 instead of Silver 70?

MEDICOVERAGE AGENT RESPONSE

Kirsten,
Silver 94 is the plan that people who receive subsidies can purchase. Subsidies can depend on your age and region so it can vary.  Additionally many states are not ready to include subsidies in their calculations for a few months -which could be the reason why you’re not seeing your break.

Due to many of our clients being frustrated with the delays and glitches, such as the subsidies being figured out later and doctor/hospital finders currently unavailable in many states, we suggest you wait to enroll in a new ACA plan. Your coverage will not be delayed if you enroll in your ACA plan by December 15, 2013. Until then feel free to call us at 800-930-7956 to help you figure out how your subsidy would work.
-Eric at Medicoverage.com


By Michael F. Morrissey on October 22, 2013

Example: A person with a subsidizded Standard Silver Plan tears an Achilles tendon playing basketball, admitted to a hospital resulting in a $35,000 hospital bill.

Example - Subsidized Cost Sharing: A person on the Silver Plan at 175 percent of the FPL has a $500 deductible, a MOOP limit of $2,250 and pays 13% of expenses

A hospital bill is $35,000 minus the $200 deductible =  $34,800, 13% of expenses = $4,524. Since I have a MOOP limit of $2,250 my total cost including the individual deductible is $2,450.  Plus a Yearly Premium of $2,400.  Total cost-  $4,650.

LEGEND:
D-  Deductible
P -  Premium
YP - Yearly Premium
MOOP Maximum out-of-pocket expense
FPL -  Federal Poverty Level

 

 


By steve on October 23, 2013

I enrolled in the silver94 plan along with federal subsidies.  Our family was excepted! Printed out confirmation, silver94. Next I printed the enrollment summary which said silver70.
Why did this change?

MEDICOVERAGE AGENT RESPONSE

Steve,
Thanks so much for your question. You are the first person that we have heard from that has signed up for an ACA plan.  Our understanding that things are pretty wonky right now on the state and federal exchange websites. This is why we are recommending that our clients wait for some of the technical issues to be resolved. 

In your case we do not know why your confirmation has a different silver value.  There could be a glitch in the system. We have also been told that some states are unable to process subsidies until later so this might explain it. If you are working with an agent, please contact them and they should be able to assist you and make sure you are on the correct plan. 
-Michelle from Medicoverage.com


By Frankie on October 30, 2013

Why are co-pays available for the Silver and not the Bronze Plans?

MEDICOVERAGE AGENT RESPONSE

Frankie,
Thanks for your question. Co-pays are available for Bronze plans, but most services are covered after you meet your deductible.
-Eric from www.medicoverage.com


By Pam Ernst on December 18, 2013

I am applying for the Silver 94%.  I live in California in Santa Cruz County.  I am interested in Health Net.  I have a hard copy of the application and am faxing it in and mailing it in as well.  The online application keeps crashing on me.  How do I go about applying for the insurance?  How do I know what the premium is? 

MEDICOVERAGE AGENT RESPONSE

Pam,
Thank you for your question. We understand your frustration with the site’s complications. We too are seeing long delays accessing the exchange site. Please give us a call at 800-930-7956 and we can help you
-Michelle at www.medicoverage.com



Leave a comment















ObamaCare by State
Find the latest ACA news on your state here




Current Members Click here




Insurance services provided by Medicoverage Inc. DBA Regal Benefits insurance services. Copyright © 2004-