Most people under age 65, even if they are ineligible for Medicaid or some other public program, are eligible for various tax subsidies such as exclusions, deductions, and credits that reduce the cost of purchasing private health insurance. One group excluded from receiving tax subsidies under current law is people without access to an offer of employer-sponsored insurance (ESI) and whose incomes exceed the eligibility threshold for premium tax credits in the Marketplace.1 In this brief, we analyze a policy that would expand Marketplace premium tax credits to some people in this group. Most people with family incomes from 400 to 600 percent of the federal poverty level (FPL) are covered by health insurance through an employer-sponsored plan. The small share of people in this group without access to coverage through an employer generally purchase a plan in the nongroup market, but some are uninsured. In the nongroup market, however, people must pay the full gross premium of any plan they choose because they are ineligible for the premium tax credits that reduce out-of-pocket premiums for people with lower incomes enrolling in coverage through the Marketplaces. Under current law, premium tax credits are available in the Marketplaces only for people with incomes from 100 to 400 percent of FPL who also meet other requirements. A policy that expands premium tax credits by raising the eligibility cutoff from 400 to 600 percent of FPL would lessen the financial burden of high premiums for such families and increase Marketplace enrollment for this group.
Copyright:
Reproduced with permission of the copyright holder. Further use of the material is subject to CC BY-NC-DC license. (More information)