by Eleanore D. Sanchez
Around 2.5 million people who bought insurance outside the public exchanges set up under the Affordable Care Act may be qualified for tax credits that would help towards paying for their premiums.
According to a report from the Department of Health and Human Services, insurance from these public exchanges offer tax credits for clients with income levels up to four times the poverty level as defined by the federal government, which amounts to $100,000 for a family of four. Further, these exchanges work on the principle that the lower the income, the more help is extended to the customer.
However, customers must buy insurance from the exchanges to avail of the subsidies. This provision has left millions of Americans in a crunch, as they may be leaving money on the table if they don’t buy from their off-exchange marketplaces again for 2017 coverage.
HHS adds that several states have more than 100,000 individuals enrolled in off-exchange insurance policies who may qualify for subsidies if they purchase on the exchanges.
Further, another estimated 7 million buy individual coverage without the benefit of tax credit for the full price of the policy. This set up can expose them to sharp premium hikes if they don’t shift to a cheaper plan. Some insurance companies have proposed increases of more than 10% for next year.
Additionally, HHS said although it has already extended subsidies to some 9 million policy holders, many remain unaware of the potential benefits of joining these exchanges.