KHN: Consumers Whose Income Drops Below Poverty Get Break On Subsidy Payback

By Michelle Andrews

Right about now, some low-income people who just barely qualified for subsidies on the health insurance marketplace are starting to worry: What if my income for the year ends up below the poverty level? Will I have to pay back the premium tax credits I received?

A couple of readers have posed this question in recent weeks.

Their concern stems from an unfortunate wrinkle in the health law. Premium tax credits that make coverage on the health insurance exchanges more affordable are available only to people with incomes between 100 and 400 percent of the federal poverty level ($11,490 to $45,960 for an individual this year). People whose income is below the poverty line don’t qualify.

When the health law passed that wasn’t expected to be a problem because in addition to providing subsidies to help pay for health plans purchased on the health insurance marketplace, the law expanded Medicaid coverage to adults with incomes up to 138 percent of the federal poverty level ($15,856 this year). That meant that people with incomes below the subsidy threshold on the private exchanges would generally qualify for Medicaid. They wouldn’t need premium tax credits. 

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  • LAAAC is managed by St. Barnabas Senior Services; Funded, in part, by Archstone Foundation.
  • St. Barnabas Senior Services

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