ACA subsidy
Government financial help to reduce your health insurance premium on the marketplace.
Full definition
The Affordable Care Act (ACA) provides premium tax credits to individuals and families whose income falls between 100% and 400% of the federal poverty level (FPL) — and in some cases above 400% under enhanced subsidies. The subsidy reduces your monthly premium directly. Your subsidy amount depends on your income, family size, and the cost of benchmark plans in your area. Apply through healthcare.gov.
Real-world example
A family of 3 earning $65,000/year may qualify for $600+/month in premium subsidies, reducing a $1,400/month benchmark plan to $800/month or less.
Quick summary
Government financial help to reduce your health insurance premium on the marketplace.
Related terms
- Health insurance deductible
The amount you pay for health care each year before insurance starts paying.
- Premium
The amount you pay for your insurance policy, usually monthly or annually.