Who Gets a Subsidy When Purchasing Health Insurance? The Answer May Surprise You

11.20.2014 | 3 min read

As you’ve probably heard, everyone is now required to have health insurance. If you don’t already get insurance from your employer, through your parents, or through the government, now is the time to enroll. Think you can’t afford it? While the health care law increased the value of health insurance plans in America, it also increased the opportunities to get financial help. Here are two ways you might be eligible for lower costs:

You could qualify for lower premiums (monthly cost to have coverage)
You could qualify for lower out-of-pocket costs (what you pay when you go to a doctor)

Don’t think you’ll qualify? Take a look at the numbers. Last year, 88% of on-Marketplace Blue Cross enrollments were eligible for a subsidy and 22% of BCBSM enrollees experienced reductions of $500 - $1000 in monthly premiums. That’s $6,000 to $12,000 saved each year for almost a quarter of enrollees.

So how do subsidies work?

Subsidies are calculated using a “benchmark plan,” which is the second-lowest silver plan available to you. The health care law set a maximum portion of your income that can be used to buy insurance. If buying the benchmark plan exceeds that maximum, subsidies will kick in to cover the difference. In short, whether you are eligible for subsidies will depend on your household income, family size and the cost of the benchmark plan in your county. If you do receive a subsidy, you might also be eligible for cost-sharing assistance. This means you’d have some extra financial help with other health care costs that may come up throughout the year. To estimate your eligibility, text “4subsidy” to 222-753 or use this online subsidy estimator If your income falls below subsidy levels, you may be eligible for Medicaid or the Healthy Michigan Plan (coverage tailored for those whose income is not enough to qualify for a subsidy on the Marketplace, but too much to receive Medicaid). To see if you qualify, you can apply online at michigan.gov/mibridges, by phone at 855-789-5610, or in person at a local Department of Human Services office.

Think you qualify?

Great! Go to HealthCare.gov to fill out an application to verify the level of financial support you’re eligible for and shop around for health insurance. You can also call the Marketplace at 800-318-2596. If you don’t qualify for financial assistance, you don’t need to enroll through HealthCare.gov. The same plans are available at the same price both on- and off- the Marketplace. To start shopping for plans, visit bcbsm.com/myblue. During open enrollment, Health Plan Advisors are available to help you enroll 8 a.m. to 8 p.m. seven days a week. There are also more than 6,000 Blue Cross agents statewide. To find one in your area, visit bcbsm.com/findanagent. For more health insurance tips visit bcbsm.com/101 or follow the hashtag #Covered101 on our social channels. If you have a specific question, please submit your query online through our Customer Action Center. Photo credit: Frédéric de Villamil