Marketplace plans provide three (3) subsidy options for members needing cost assistance. The Advance Premium Tax Credit (APTC) reduces monthly premium amounts, while the Cost Share Reduction (CSR) allows for lower out-of-pocket costs and reduced cost-sharing.
Subsidies are not available for small group plans or plans purchased directly through Vantage. The Centers for Medicare and Medicaid (CMS) determines member eligibility for and level of subsidy.
Individual members may be able to receive an APTC to help members pay their monthly health insurance premiums. Members may choose how much advance credit payments to apply to premiums, up to a maximum amount.
If the amount of advance credit payments a member chooses to receive for the year is less than the maximum tax credit due to the member, the difference will be sent to the member as a refundable credit in his federal income tax return.
If the amount of advance credit payments for the year is more than the amount of credit to the member, the member must repay the excess advance payments with his federal tax return.
The amount of the premium tax credit will vary from individual to individual depending on the household income of the tax filer (and dependents) and the premium for the Exchange plan that the tax filer (and dependents) is/are enrolled, along with other factors.
A subsidy calculator may be found at: http://kff.org/interactive/subsidy-calculator/
Individuals enrolled through the Exchange may also be eligible for cost-sharing assistance. Like APTC, this assistance is also based on income and family size. CSR assistance provides for reduced cost-sharing for families with incomes between 100% and 250% Federal Poverty Level.
CSR assistance reduces the out-of-pocket costs and annual cost-sharing limits which an enrollee would be required to pay for covered services, such as deductibles, copayments, coinsurance and out-of-pocket maximum amounts.
During the plan selection and application process, you will be asked to enter information on your annual household income, the number of people in your household, whether they have an offer of health coverage through your employer, and a few other questions. CMS uses your responses to offer premium assistance (APTC) and/or CSR plans.