Health Reform WK-EDGE Millions missing out on potential subsidies by shopping off-marketplace
Monday, October 17, 2016

Millions missing out on potential subsidies by shopping off-marketplace

By Kayla R. Bryant, J.D.

Around 2.5 million people who purchase insurance coverage off-marketplace may be in the income bracket to qualify forsubsidies. According to the HHS Assistant Secretary for Planning and Evaluation (ASPE), an estimated 6.9 millionconsumers in the individual market are choosing to shop off-marketplace, where tax credits are unavailable (ASPE Report, October 4, 2016).

Eligibility. The ASPE estimates that 2.5 million people fall into the tax credit income bracket, and 1.1 million of these consumers may qualify for assistance with out-of-pocket costs. In addition, of the 6.9 million off-marketplace purchasers, about 1.9 million may qualify for Medicaid, have incomes that place them in the coverage gap for states that have not expanded their Medicaid programs, or are ineligible for marketplace coverage because of their immigration status.

Explanations. The ASPE identified two possible reasons consumers may be missing out on financial assistance. The ASPE believes that many consumers are unaware of the assistance available to them on the marketplace. Additionally, as the market changes, those who failed to qualify for financial assistance previously may not know that they are now eligible. When premiums go up, more people qualify for the credits, which are designed to cover the difference between the cost of a plan and the share of a consumer’s income the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) determines should go toward purchasing health coverage. The ASPE believes that many consumers would benefit from visiting a marketplace to purchase their 2017 coverage.

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