The American Rescue Plan Act of 2021 is a sweeping piece of legislation signed into law on March 11. The most highly publicized provision of the act is a third round of economic stimulus. Every eligible American will receive $1,400 for economic relief amidst the Covid-19 pandemic, if you haven’t received it already.
The act also substantially changes health insurance premiums and subsidies for Marketplace plans. This has gotten far less press.
Overview of ACA Changes Under American Rescue Plan
Nearly everyone who purchases health insurance under the Affordable Care Act (ACA) Marketplace plans will benefit by the changes enacted as part of the American Rescue Plan Act of 2021. In summary:
Early retirees with an income 100%-150% Federal Poverty Limit (FPL), who already paid little for health insurance premiums, will now pay $0 premiums for Silver Level plans.
Those with incomes from 150%-400% FPL will see substantial reductions in health insurance premium costs.
Those with incomes that exceed 400% FPL will no longer be subject to the ACA “subsidy cliff.” Health insurance premiums costs will be capped at 8.5% of income.
Older early retirees approaching Medicare age will benefit the most because costs rise as we age.
That’s good news across the board for early retirees who need to purchase medical insurance through Marketplace exchanges to bridge the gap from employer provided coverage to Medicare.
Call Mintco Financial Advisors to help lower your health insurance premiums.
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