Health insurance tax credits subject of new Kaiser analysis
Next year in the U.S., all citizens aged 18 and above will be required to purchase and maintain health insurance coverage due to federal law. This is one of the most controversial aspects of the Affordable Care Act, but the federal government has been working to highlight the fact that the law allows for consumers to receive financial assistance from the government when purchasing insurance coverage. This week, the Kaiser Family Foundation has released information concerning the financial aid that people could receive.
Average tax credit stands at $2,700
According to Kaiser’s estimates, those purchasing health insurance exchanges through state-based exchanges could receive an average of $2,700 in tax credits from the federal government. The value of the tax credits will be determined by several factors, such as income, family size, and the overall cost of the coverage that is being purchased. Those with incomes falling 100% to 400% below the federal poverty level will be eligible for these tax credits. Consumers receiving health insurance coverage from their employers will not be eligible for these tax credits.
Federal law remains a controversial issue
The Affordable Care Act’s health insurance mandate has been the subject of controversy since the law was passed in 2010. Opponents of the law suggest that forcing people to purchase and maintain coverage is unconstitutional. This mandate is one of the reasons that the federal law was brought before the Supreme Court, which upheld the law as constitutional. The federal government has been working to inform consumers that they could be eligible for financial aid since early 2012.
Tax credits could limit burned of health insurance costs
The tax credits are meant to limit the financial burden of health insurance coverage. This financial aid will be available to those purchasing coverage from state-based exchanges whether these exchanges are operated by their host state or by the federal government. According to federal law, health insurance plans sold through these exchanges are required to cover no less than 60% of the costs associated with medical care.