Stimulus-enhanced Affordable Care Act subsidies coming April 1, but the jobless will have to wait longer

Affordable Care Act enrollees and those looking for Obamacare coverage can start accessing the stimulus-enhanced premium subsidies on the federal exchange on...

Posted: Mar 12, 2021 1:31 PM
Updated: Mar 12, 2021 4:45 PM

Affordable Care Act enrollees and those looking for Obamacare coverage can start accessing the stimulus-enhanced premium subsidies on the federal exchange on April 1, the Biden administration announced Friday.

But the jobless will have to wait longer to enroll in the zero-premium plans provided by the $1.9 trillion relief package that President Joe Biden signed Thursday, according to the Department of Health and Human Services.

The announcement comes as multiple federal agencies are racing to implement the wide range of provisions in the massive legislation. The $1,400 stimulus checks will start going out this weekend, but it will take weeks or months to get other relief to the people who need it.

The American Rescue Plan provides heftier federal premium subsidies for Affordable Care Act policies for two years. About 15 million uninsured Americans will be eligible for financial assistance, as will those who have Obamacare coverage but earned too much to qualify for subsidies.

Also, 9 million people currently in subsidized plans will receive more aid.

The relief package makes two changes to the subsidies to address long-standing complaints that Obamacare plans are not affordable for many people, particularly the middle class.

Enrollees will pay no more than 8.5% of their income toward coverage, down from nearly 10% now. And lower-income policyholders will receive subsidies that eliminate their premiums completely.

Also, those earning more than the current cap of 400% of the federal poverty level -- about $51,000 for an individual and $104,800 for a family of four in 2021 -- will become eligible for help for the first time.

Residents of the 36 states that enroll through the federal exchange, healthcare.gov, will see the larger subsidies when they go to the site starting April 1. States that run their own exchanges are aiming for a similar time line, but their implementation dates could vary, according to a senior administration official.

The uninsured can sign up on the federal exchange through May 15, under a special enrollment period ordered by Biden. Most state-based exchanges are also allowing residents to obtain coverage for the next few weeks or months.

Current Affordable Care Act enrollees can return to the exchanges to obtain the larger subsidies or change their plans. Those who don't will receive the more generous subsidies when they file their taxes next spring.

Premiums will decrease about $50 per person per month, on average. An uninsured couple making $70,000 annually could find coverage for $1,000 less per month than they would have before the law was passed. A family of four making $90,000 a year could see their premiums drop by $200 a month.

Special subsidies for the unemployed not ready yet

The stimulus package also provides new subsidies for those who lost their jobs, but those folks will likely have to wait a little longer.

The law allows those collecting unemployment benefits to sign up for Obamacare coverage with no premiums in 2021. However, since this subsidy doesn't currently exist, it will take longer to set up, said the official, who did not have an estimated start date.

Until then, the jobless can still shop for plans on the exchanges and receive enhanced subsidies, though they may have to pay a premium depending on their income.

Also, laid-off workers who want to remain on their employer health insurance plans through COBRA will not pay any premiums from April through the end of September, under the relief law. The agency is working with the Treasury and Labor Departments to enact this measure, but the official did not have a start date.

This story has been updated with additional details.

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