What You Need to Know About the Inflation Reduction Act
The newly passed Inflation Reduction Act (IFA) will help consumers offset premiums who have individual coverage through the Affordable Care Act (Obamacare) for at least the next three years. The IFA will prevent steep price increases with the enhanced subsidies sticking around for three more years. With the subsidies set to expire in 2022, some families could have seen their health insurance premiums increase $10,000 or more. The enhanced subsidies are helping to offset the total plan premium, and will make rate increases more manageable and possibly negligible for some families.
The IFA also has allowed those with higher incomes to still qualify for subsidies. If not, anyone making more than 400 percent of the poverty level, which is also referred to as the “Subsidy Cliff”, would have received zero premium assistance, and would be responsible for paying 100 percent of the plan premium—meaning, no subsidies.
Without the IFA, and both of the above occurring of no enhanced subsidies and the return of the subsidy cliff, it has been estimated that a couple million people may not have been able to afford their ACA plans, and may have gone without health insurance—which is the polar opposite of what the ACA intended when it was first signed into law. The ACA’s goal was to cover the uninsured, and at least for the next three years, hopefully the number of those without health insurance will be able to find plans that fit closer to their budget.
Contact your ARC representative with any questions.