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How the COVID Relief Bill Makes Health Insurance More Affordable

The $1.9 trillion COVID-19 relief package signed by President Joe Biden on March 11 has significant impacts on health care access and affordability.

The law bolsters the Affordable Care Act and makes Marketplace health insurance plans more affordable and more accessible. These changes are in effect from Jan. 1, 2021 to Dec. 31, 2022. Here are the ways the new law helps more people afford health insurance:

Boost affordability of Marketplace plans  

The new law increases the amount of advance premium tax credits people receive. These are refundable credits that people can get to help them pay for Marketplace insurance plans purchased in Michigan on www.healthcare.gov.

The law also means people with incomes up to one and a half times the poverty level (about $19,300 for a single person) do not have to pay any premium for certain plans on the Marketplace. This improves the affordability of health insurance for people at this income level, as previous options were high-deductible plans that meant people spent more out-of-pocket for their care.

Expand access to subsidized health insurance

About 3.4 million Americans without health insurance previously earned too much money to receive subsidized coverage through the exchange. This was known as the “subsidy cliff” that abruptly stopped subsidies for people with incomes more than four times that of the poverty level.

Here’s an example of how the subsidy cliff worked:

A 60-year-old woman earning $50,000 per year at 392% of the poverty level paid no more than $410 per month for a silver plan, due to subsidies. But if her income crossed the 400% cutoff, her health insurance costs would skyrocket: with an income of $52,000 per year, the woman would pay the full price of the premium – about $957 per month.

The new law eliminates that subsidy cliff and now allows individuals who earn more than 400% of the poverty level (about $51,520 for a single person and $106,000 for a family of four) to also receive subsidized health insurance. Older individuals or people who live in areas with high premiums will realize the most savings from this change.

The actual impact to consumers buying health care through the Marketplace will vary depending on income, age, family structure and the cost of plans available in their area.

Increase affordability of health insurance for unemployed workers

The law also provides increased tax credits to individuals who receive unemployment benefits for any week in 2021. An individual who experiences unemployment receives a maximum subsidy for all of 2021, with the option to purchase a benchmark silver plan at no cost.

How to shop for health insurance

A special enrollment period has been established to allow people to sign up for 2021 Marketplace health insurance coverage. The newly expanded timeframe to enroll for health insurance coverage runs from Monday, Feb. 15, through Sunday, Aug. 15.

If you are applying for the first time, Blue Cross Blue Shield of Michigan is here to help you shop for a plan.

Online:Visit www.BCBSM.com/myblue  to review plans and shop for coverage. If you already have an online account for a Blue Cross individual or family plan that’s in your name, you’ll be asked to log in. If not, you’ll be asked a few simple questions to get a quote for your coverage.

Over the phone: Call a Blue Cross Blue Shield of Michigan health plan advisor at 800-227-8544, or fill out this form to have a health plan advisor call you.

Selecting a health care plan can be confusing. Blue Cross’ expert health plan advisors can help you understand and find coverage that could be more affordable than you think.

Blue Cross Blue Shield of Michigan is currently waiting on additional regulatory guidance regarding first quarter 2021 rebates to certain plans.

 

 

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