Enhanced ACA Subsidies to Extend Through 2025

August 2022

The American Rescue Plan Act of 2021 has provided enhanced ACA premium subsidies for people who purchased a plan through the Marketplace. It did so by removing the income cap, which limited subsidies to households with incomes from 100% to 400% of the federal poverty line. With no income cap, premiums have been limited to just 8.5% of income – for everyone.

The Inflation Reduction Act, which was signed into law on August 16, extends these subsidies for three years for millions of Americans who buy individual coverage under the ACA.

This bill will “save millions of people an average of $800 a year on health insurance premiums,” said Chiquita Brooks-LaSure, Administrator of the Centers for Medicare & Medicaid Services.

“The extension of these tax credits will protect nearly 13 million Americans from cost increases at a time when the price of everything—from gas to groceries—is rising,” said Kim Keck, president and CEO of Blue Cross Blue Shield Association. “This move keeps real money in the pocketbooks of Americans and gives them real peace of mind.”