After you fill out an application with the Health Insurance Marketplace and provide household and income information, you’ll find out if you qualify for a premium tax credit that lowers your monthly health insurance bill.
You’ll also find out if, in addition, your income qualifies you for extra savings known as “cost-sharing reductions.” If it does, you can save money a second way: By paying less out of pocket each time you get medical services.
If you qualify for these extra savings on out-of-pocket costs, you get them only if you enroll in a plan in the Silver category. You can use a premium tax credit for a plan in any metal category, but you’ll get extra cost-sharing reductions only if you pick a Silver plan.
Use this quick tool to see if your 2018 income estimate falls in the range for cost-sharing reductions.
If you qualify for savings on out-of-pocket costs and enroll in Silver plan:
Important: The above are just examples to illustrate how cost-sharing reductions work.
Plans in all categories have a wide range of deductibles, copayments/coinsurance, and out-of-pocket maximums. You'll know exactly how much you save on out-of-pocket costs only when you shop for Silver plans in the Marketplace.
Learn about special cost-sharing reduction rules for American Indians and Alaska Natives.
After you apply for Marketplace coverage, check your Eligibility Determination Notice. If it says "Can choose a health plan with lower copayments, coinsurance, and deductibles" and is followed by (04), (05), or (06), you qualify for income-based savings — but only if you pick a Silver plan.
No. Cost-sharing reductions apply only to Silver plans. (Catastrophic plans are also not eligible for a premium tax credit, no matter what your income is.)