Kevin Knauss: Health, History, Travel, Insurance
Posts related to the California Premium Subsidy, which is a health insurance subsidy targeted on income of 400% - 600%.
You are first offered the chance to adjust the APTC subsidy from 100 percent to a lower percentage when you first enroll in a Covered California health plan. After the enrollment has been completed you must fish around in your account to find the APTC slider. The APTC slider allows you to reduce or dial back how much of the monthly APTC subsidy you are receiving from 100 percent down to 0.
Fortunately, for most California taxpayers, the amount of the California premium assistance subsidy (CPAS) they received was relatively small. For some Covered California households who received large monthly amounts of the CPAS, the repayment could significantly add to their California income tax liability for 2021.
Tom received unemployment insurance in 2021. Because of the unemployment insurance, Tom’s household income is 133 percent of the federal poverty level, regardless of his income. That 133 percent of the federal poverty level translates into $0 annual contribution for the second lowest cost Silver plan. Since the second lowest cost Silver plan premiums equaled $15,000 for the year that amount becomes the maximum subsidy allowed. Tom is eligible for an additional $2,318.40 ($15,000 – $12,681.40) in Premium Tax Credit because of the unemployment insurance benefit.
When you remove a family member from the health plan only, not the tax household, and everything else stays the same, the subsidy will decrease. The income is the same. The household size is the same. The full rate of the health insurance has been reduced. As the health insurance cost is reduced, the subsidy is reduced as less subsidy is needed to keep the household’s health insurance premium at the consumer responsibility level.
It is counterintuitive, but for 2022, increased competition in the health insurance market for Contra Costa County will increase the premiums for Covered California members in the region. How is this possible? The subsidies are based on the Second Lowest Cost Silver Plan. Bright HealthCare, a new health plan, will offer Silver plans in 2022 […]
The new 2022 California Premium Credit Program covers the cost of said rule so that anyone who had a $1 monthly charge, will now have a $0 premium for their health insurance. Of course, the credit could not apply just to people were being charge only $1, everyone must receive the special $1 dollar bonus.
In this example, the annual amount of the SLCSP is $15,000. The consumer fair share dollar amount of $8,500 is subtracted from the $15,000 to yield a Premium Tax Credit amount of $6,500. The difference of $6,500 is divided by 12 to get a monthly Advance Premium Tax Credit subsidy of $541.67 per month.
Covered California will begin processing the extra subsidy increase for applications that indicate unemployment benefits on June 21, 2021. The unemployment insurance benefit could have been for just one week in January. The household income will be taken down to 138.1 percent of the federal poverty level, regardless of the income estimated by the consumer. The 138.1 percent income level will prevent adults from being automatically determined eligible for Medi-Cal. The new subsidy will be based on the lower income and applied to the health insurance premium.
Covered California has worked with the health plans to transfer any accumulation of member health care expenses from the off-exchange plan to a new on-exchange plan through Covered California. For example, if you have spent $1,000 toward meeting your deductible under your current plan, that $1,000 accumulation would be transferred to the new plan. Many health plans have announced they will participate in the transfer.
Taxpayers who have already filed their 2020 tax return and who have excess APTC for 2020 do not need to file an amended tax return or contact the IRS. The IRS will reduce the excess APTC repayment amount to zero with no further action needed by the taxpayer. The IRS will reimburse people who have already repaid any excess advance Premium Tax Credit on their 2020 tax return.
