- Advanced Premium Tax Credits (APTC) extend beyond 400% of the Federal Poverty Level. There is no upper limit for APTC, but the credit will go away once the premium for the benchmark Silver Plan (the second-lowest cost Silver Plan) is at or below 8.5% of someone's projected income.
- Anyone receiving unemployment benefits at any point in 2021 will be determined to have a FPL of 133%, regardless of their actual income. This ensures that anyone who received UI benefits will effectively qualify for a zero-dollar benchmark Silver Plan.
- Details about this provision are not yet available, but we expect it to be in effect by July 1st.
- People who underestimated their 2020 income, will not need to repay APTC.
This provision is just for tax year 2020 (and the IRS just extended the tax filing deadline to May 17th). We are still waiting on guidance for this new provision, stay tuned!
Implementation Q & A:
Here are a few of the most important questions and answers from a recent CMS FAQ about the ARPA and the Marketplace.
Q: Will HealthCare.gov automatically update premium tax credits on behalf of current enrollees?
A: If consumers don’t take action, they’ll still receive the additional benefit as part of their premium tax credit when filing their federal income tax return next year. Beginning on April 1, consumers must come back to HealthCare.gov to update their application in order to receive these increased tax credits this year. However, we are also exploring whether tax credits can be updated on behalf of consumers during 2021.
Q: When will the extra tax credits be available on HealthCare.gov?
A: Increased premium tax credits based on the lower income contribution percentage along with expanding tax credit access to consumers with household incomes above 400%, will be available through HealthCare.gov starting on April 1. This means that new consumers and current enrollees who submit an application and select a plan on or after April 1 will receive the increased premium tax credits for 2021 Marketplace coverage.
Extra tax credits for consumers receiving unemployment compensation will be available starting this summer.
Q: If I’m currently enrolled in a Marketplace plan, how do I receive the additional tax credits/lower premiums?
A: Current enrollees, including those who recently enrolled through the 2021 Special Enrollment Period, can update their applications and enrollments in order to get new eligibility results starting April 1. You will need to reselect your current plan in order for the changes to take effect to reduce your premiums for the remainder of the year.
Q: If I’m currently enrolled through the Marketplace, what will happen if I don’t come back in?
A: Consumers who enrolled in Marketplace plans prior to April 1 have the choice of waiting until they file their taxes next year in 2022 to receive the additional premium tax credit amount when they file and reconcile their 2021 taxes. However, we recommend all enrollees come in, update their application, and review their plan options during the 2021 Special Enrollment Period through May 15 because you may be able to choose a plan with lower out of pocket costs for the same price or less than what you are currently paying.
Other OE 8.5 & ARPA Resources:
The Kaiser Family Foundation has updated their subsidy calculator
but you can also check out the old calculator to see the difference in savings!
Health Reform: Beyond the Basics has a few great resources included the Yearly Guidelines and Thresholds and a brief FAQ about ARPA. They also have a FAQ about OE Re-Opened Enrollment.
Check out CMS resources for this Special Open Enrollment Period. You can also check out this wonky "technical stakeholder guidance" if you are looking for some more details.
Open Enrollment 8.5 and the ARPA By the Numbers!