$0 Premium Health Insurance – The 2021 COVID Relief Bill

Sarah Sullivan
August 3rd, 2021 May 12th, 2021 |
Read time: 6 minutes
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President Biden signed the 2021 American Rescue Plan Act (ARP, also known as the “2021 COVID Relief Bill”) on March 11, 2021. While the most well-known provisions of the bill were likely the $1,400 stimulus checks and enhanced child tax credits,[1] it also included critical provisions that increase access to Affordable Care Act (ACA) health plans.[2]

In fact, it is estimated that an additional 8 million people are newly eligible for premium tax credits as a result of the COVID Relief Bill.[3] And you could be one of them.

Find out if you could be eligible for additional savings with premium tax credits.

ACA Subsidy Calculator

How the COVID Relief Bill Impacts Health Insurance

The COVID Relief Bill temporarily increases ACA subsidies for people enrolled in marketplace health plans (effective through 2022),[4] across all income categories. It also reduces the percent of annual income an enrollee is responsible for paying in ACA premium, lowering the upper limit from 9.83% to 8.5% and removes the cap on those at or over 400% of the Federal Poverty Level (FPL).[5]

These adjustments are shown in the table below, which compares the percent of premium an individual pays based on their income level before and after the COVID Relief Bill.

Percent of Income Paid by Enrollee for Marketplace Benchmark Silver Premium (by income)[6]

Enrollee’s Income as % FPL Before COVID Relief After COVID Relief
Under 100% FPL Not subsidy-eligible Not subsidy-eligible
100 – 138% FPL 2.07% 0%
138 – 150% FPL 3.10 – 4.14% 0%
150 – 200% FPL 4.14 – 6.52% 0 – 2%
200 – 250% FPL 6.52 – 8.33% 2 – 4%
250 – 300% FPL 8.33 – 9.83% 4 – 6%
300 – 400% FPL 9.83% 6 – 8.5%
Over 400% FPL Not subsidy-eligible 8.5%

Notably, the COVID Relief Bill did not address the ACA’s “family glitch.” That means if you have access to affordable group coverage through yours or a family member’s employer at 9.83% or less of your annual household income for self-only coverage, neither you nor your family qualify for ACA subsidies.[7]

How the COVID Relief Bill Impacts You

Here is how the COVID Relief Bill could impact you depending on your situation:

Qualify for a $0 premium ACA Bronze or Silver plan.

If your income is 100-150% FPL you now qualify for a totally subsidized ACA plan.[8] If you’re already enrolled in a subsidized Bronze plan, you may be able to upgrade to a Silver plan (which would lower your out-of-pocket costs) for no additional premium cost, or even a Gold plan for some premium cost.[9] Learn more about the ACA metal levels.

The Kaiser Family Foundation (KFF) estimates that at least 5.2 million people are now eligible for $0 premium Silver plans with additional cost-sharing reductions that bring their deductibles down to $177 on average.[10]

Middle-income earners could receive a premium tax credit.

For the first time, if your income is at or above 400% FPL, you could receive assistance. In fact, the COVID Relief Bill flattens the ACA’s “subsidy cliff” by extending subsidies so that no one pays more than 8.5% of their income in ACA premium.[11]

For example, individuals with an annual income of $51,050 or $104,800 for a family of four are now eligible for premium tax credits.[12]

Get a $0 premium Silver ACA plan if you collected unemployment insurance in 2021[13]

If you’ve since returned to work but still don’t have access to employer benefits for any reason (such as being a part-time or contract worker) you can still enroll in a $0 Silver plan as long as you collected unemployment benefits at least once in 2021.[14]

Keep your employer group plan longer if you’ve been laid off.

COBRA premium subsidies to companies from April 1 through September 30, 2021, mean you don’t pay anything in premium during that period if you opt for COBRA after being laid off and are not eligible for Medicare or other group health coverage.[15] Learn more: Dept. of Labor COBRA Premium Assistance FAQ.

Do You Qualify for an Affordable Care Act Subsidy?

Use the ACA Subsidy Calculator to find out if you can get financial help if you enroll in ACA-qualifying major medical insurance. Learn more about subsidies.

Can You Get a Subsidized ACA Plan Now?

If you qualify for ACA coverage you can shop for and enroll on HealthCare.gov (the Federally Facilitated Marketplace) during the COVID-19 Special Enrollment Period through August 15, 2021.[16]

Any advance premium tax credits and cost-sharing reductions you qualify for will be calculated for you during the application process.[17] Some states run their own ACA Exchange and may have different special enrollment dates, so it’s important to check with your state’s Exchange right away.

If you missed the HealthCare.gov COVID-19 Special Enrollment Period, you may still be able to qualify for an individual special enrollment period. If you or a household member lost qualifying coverage since January 1, 2020, you may still qualify for an individual special enrollment period due to the COVID-19 national emergency.[18]

HealthCare.gov will point you to the correct location to shop and apply for an ACA plan. You can also call 888-855-6837 to speak directly to an agent for assistance.

Shop and Compare ACA Plans

If You’re Already Enrolled on HealthCare.gov

If you already have a subsidized ACA plan, log in to your account on HealthCare.gov during the COVID-19 Special Enrollment Period and update your application and enrollment to see your additional tax credit amount.

You may then want to change your plan selection, especially if it means you can access a plan for the same premium cost (or less) with lower out-of-pocket costs. Note that doing so may cause your deductible to reset.[19]

Start at HealthCare.gov to learn how to update your application. You can also call 888-855-6837 to speak directly to an agent for assistance.

Filling Gaps with Supplemental and Dental Coverage

If you’re able to reduce your monthly premium costs but are still concerned about a high deductible, you could divert some of those monthly premium dollars towards a medical gap plan.

Gap plans provide a fixed lump-sum benefit for qualifying critical illnesses or accidents, which can then be used towards out-of-pocket costs until your ACA policy begins paying a portion of the costs.

Remember, ACA plans don’t include dental coverage as essential health benefits for adults.[20] Dental plans are relatively affordable and can help especially with costs associated with preventive and basic care like teeth cleanings and fillings. You may wish to use some of your ACA premium savings to purchase dental benefits.

Shop Dental Insurance                            Shop Medical Gap Insurance

Get a Subsidized ACA Health Plan – Don’t Wait!

It just takes a few minutes to find out if you could be eligible for premium savings. Act now to begin saving on your monthly premium costs if you qualify.

Find out if you could be eligible for premium tax credits.

ACA Subsidy Calculator

You may also call 888-855-6837 to speak to a licensed agent and get assistance determining your ACA subsidy eligibility, enrolling, and accessing additional Gap or Dental coverage.

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Originally Published On May 12th, 2021
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