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January 31, 2020 at 01:01 PM
The federal government paid about $38 billion in Affordable Care Act (ACA) premium tax credit subsidies for people with ACA public exchange coverage in 2019.
That’s up 40%, or about $14 billion, from the 2018 total, even though the number of people receiving ACA premium tax credit help fell 2%, to 4.8 million, according to a Treasury Inspector General for Tax Administration report based on Internal Revenue Service tax filing data.
Resources
- A link to the IRS audit report is available here.
The average amount of premiums per subsidy user increased 43%, to about $7,850, according to ThinkAdvisor calculations.
The drafters of the ACA created the public exchange system, or family of government-run, web-based health insurance supermarkets, to help people shop for health coverage on an apples-to-apples basis, and to distribute premium tax credit subsidies.
The subsidies help people with annual income from 100% to 400% of the federal poverty level pay for exchange plan coverage.
ACA drafters also created a cost-sharing reduction subsidy program. The cost-sharing reduction subsidy program helped exchange plan users with income under 250% of the federal poverty level handle deductibles, coinsurance amounts and co-payments.
