People who previously earned too much to get financial help buying insurance on the state marketplace may find better deals if they look again.
Connect for Health Colorado, which runs the state’s individual health insurance marketplace, estimates the average customer will save about $56.30 per month, following a change in how tax credits are calculated.
Normally, families who earn more than four times the federal poverty limit aren’t eligible for tax credits to lower the cost of their monthly insurance premiums. For a family of four, that means those earning more than $106,000 have to pay the full cost to buy insurance on the individual market.
The most recent economic rescue package passed by Congress removed the hard cap. Instead, it requires that no family pay more than 8.5% of their income, if they buy the benchmark plan in their area. Families could choose plans that are more expensive than the benchmark plan, but they’d have to pay the extra cost not covered by the tax credit.
The change will last through 2022. After that, Congress will have to decide whether to extend it, revert to the old system, or come up with something new.
A special enrollment period due to the pandemic will run through May 15. Connect for Health Colorado reported 4,683 people signed up in the first month of open enrollment, which started in February.
After the special enrollment period ends, only people who experience a major life change, like losing a job or having a baby, will be able to sign up for insurance through the exchange until the next open enrollment period starts in the fall.