Texas health insurance quotes
Health Subsidy in Texas
Health Insurance Subsidies Available in 2014
Effective January 1, 2014 millions
of consumers who qualify will be eligible for premium assistance as part
of the Affordable Care Act (ACA). Individuals and families who meet
defined income requirements will be able to receive premium subsidies
and financial assistance for out-of-pocket expenses. The goal of the
subsidies is to help consumers who cannot access affordable coverage
from employers or the private insurance market.
to the Federal Poverty Level
In order to be eligible for the
subsidies and assistance with out-of-pocket expenses, an individual or
family's gross income will be compared to the federal poverty level
(FPL). The level of assistance will be determined by the percentage of
gross income to the FPL as determined by number of family members. For
example, in 2012 the FPL is $11,170 for a one-person household and rises
by $3,960 for each additional family member. The FPL for a four-person
family is $23,050. The FPL benchmark will be adjusted for inflation
each year, so these amounts will increase in 2014.
Who Will Qualify For Subsidies?
Subsidies will be available
according to ACA rules for individuals and families with incomes ranging
from 100% to 400% of the FLP. The subsidies will be used to reduce the
premium cost for health insurance coverage offered within the health
insurance exchanges. Assistance will be available for out-of-pocket
expenses for those with incomes ranging from 100% to 250% of the FPL.
Examples of out-of-pocket costs for which assistance will be provided
are copays and deductibles that would typically be the responsibility of
The New Texas Exchange Health Plans
Health insurance plans offered
within the exchange will consist of four levels of coverage designated
as metallic plans because they are titled platinum, gold, silver and
bronze. Each plan has a different actuarial value, which is the
percentage of costs each plan will cover. For example, platinum plans
will have an actuarial value of 90%, which means the plan will cover 90%
of healthcare costs, and the remaining 10% will be the responsibility of
the insured. Gold plans will provide an actuarial value of 80%, silver
plans 70% and bronze 60%. The bronze plan is excluded from subsidies
and assistance for out-of-pocket expenses.
The Silver Exchange Plan Becomes The Benchmark
The premium for the silver plan will
establish the level at which subsidies will be accessed. Since
healthcare costs vary from state to state, silver premiums will also
vary depending on the state. The percentage of premium paid by the
insured will be tied directly to the individual's actual income as a
percentage of the FPL. For example, individuals and families with
incomes at 133% of the FPL will be required to pay 2% of their income
toward the health insurance premium.
The following is a list of FPL
percentages and the percentage of income that the policyholder must pay
for health insurance premium.
Annual Premium Not To Exceed Percentage of
Up to 133% FPL
2% of income
133 to 150% FPL
3 to 4% of income
150% to 200% FPL
4 to 6.3% of income
200 to 250% FPL
6.3% to 8.05% of income
250 to 300% of FPL
8.05% to 9.5% of income
300% to 400% FPL
9.5% of income
An Example of Subsidies
To illustrate the health insurance
premium cost for plans in an exchange, assume a family of three had an
income of $38,180. The FPL for this family would be $19,090 so their
income places them at 200% of the FPL. The family would be required to
pay 6.3% of their income or $2,405 towards the premium cost of the
plan. Using the silver plan premium of $12,000 as the benchmark, the
premium paid by the family would be $2,405 and the remaining $9,595
would be paid as a
health subsidy. The family can purchase any plan available
from the exchange, excluding the bronze plan, and the premium difference
between the premium cost and the $2,405 will be made up by the subsidy.
In addition to assistance with
premiums, financial support for out-of-pocket expenses such as copays
and deductibles are available to individuals and families whose incomes
do not exceed 250% of the FPL. In order to qualify for financial
support the individual or family will be required to purchase at least a
silver plan within the exchange. The amount paid by the insured for
out-of-pocket expenses is based on a scale from 6% of out-of-pocket
expenses for the lowest income levels up to 27% of out-of-pocket
expenses for income levels up to 250% of the FPL.
Financial Assistance Summarized
Individuals and Families Up To 250%
Premium cost capped to be between 2%
and 8.05% of income based on amount earned.
Financial support for out-of-pocket
expenses to be between 65% and 27% based on amount earned.
Individuals and Families with Income
From 250% to 400% FPL
Premium cost capped to be between
8.05% and 9.5% of income based on amount earned.
The Congressional Budget Office
estimates that a combination of the two benefits - premium subsidy and
out-of-pocket expense assistance - will result in average subsidy of
$5,000 a year for individuals and families participating. Benefits will
be much higher for families with lower incomes or several children.
You can run your quote both with and without Health Subsidies through
our Texas Health Insurance Quote page.
Subsidies will not be available in the quote until Oct 1st, 2013 at the