What Is the American Rescue Plan Act?
In March 2021, President Biden signed H.R. 1319, or the American Rescue Plan. This plan got a lot of publicity because it included a third stimulus payment, which helped struggling Americans catch up on bills and Covid-related expenses. Along with individual payments, the bills included a wide range of provisions, including one to make health insurance more affordable for millions of people.
The American Rescue Plan Act provided direct relief to working Americans to help the country recover from the economic effects of COVID-19. It included a wide range of benefits for the individuals who met the income qualifications, including direct checks, extended unemployment insurance and support for small businesses.
Does the American Rescue Plan Act Benefit You?
The American Rescue Plan provides money to help qualifying Americans pay for their health insurance coverage. For those who enrolled in a plan through Nevada Health Link, health insurance premiums may go down. Those who were ineligible for financial help in the past due to being above the income limits may now qualify for reduced monthly payments.
What Are the Health Care Benefits?
In addition to direct payments and extended unemployment benefits, the American Rescue Plan included benefits that made health insurance more accessible in the form of subsidies and tax credits. Even if your income made you ineligible for subsidies last year, you may qualify for a subsidy under the plan. This cuts down on how much Nevadans pay for their health insurance, letting them put their money towards other living expenses. The plan also provided federal subsidies that paid 100% of COBRA for a limited time. If you lost your job during 2020-2021 and qualified for unemployment, you may also be able to sign up for $0 premium plans.
This aid is not permanent, but it provides assistance for 2021 and 2022, which is expected to give most Americans the time they need to financially recover from cut hours, lost jobs and other expenses that they incurred during the pandemic.
More Americans are now Eligible for a Health Insurance Subsidy
No more subsidy cliff for those making over 400% of the federal poverty level. For the first time, many Nevadan’s (those making over 400% of the Federal Poverty Level), may now be eligible for a health insurance subsidy! Plus, for currently enrolled members, the rate you are paying will most likely decrease.
For instance, if you were a 60 and 61 year old married couple, and your income was projected to be over $68,960 in 2021 you would not have qualified for a tax credit. Now, since the changes, that same couple making $80K per year, would qualify for $1007 per month! This is HUGE!
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Health Insurance Deductible
A deductible is an amount you pay before the Insurance Company starts paying. Health insurance plans will have different deductibles. You’ll be expected to pay the whole medical bill out of your own pocket until you’ve paid your deductible.
Out of Pocket Maximum
Your out-of-pocket maximum is the most you’ll have to pay for covered services in a policy period (one year), each January 1st it starts over again, and that includes cost of medications too. After you reach this amount, your health insurance plan will pay 100%.
Qualifying Life Event
If you experience a major life change, then such a change is often considered a qualifying life event. Such life events affect your existing health insurance coverage and can make you eligible to change your coverage during the special enrollment period.
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No More Health Insurance Subsidy Cliff
The American Rescue Plan eliminated the so-called subsidy cliff, or the point at which an individual’s income made them ineligible for a subsidy to cover some of their health insurance premium. You can now get a Government subsidy to help you pay for your health insurance premiums. Before these changes, if your income was over $51,040 for a single person in tax year 2021, or $104,800 for a family of 4, you were no longer eligible for a tax subsidy.
Now there is no income limit to receive these subsidies. The subsidy amount gradually slopes off to be no more than 8.5% of your household income (Modified adjusted gross – for most people, their “Adjusted Gross Income”). So, for many Nevadan’s, they will now be eligible for tax credits!
Also in this new law, if you ended up making more than you estimated for tax year 2020, you will not be required to pay back those subsidies.
Free or Nearly Free health insurance for any employee who lost their job and collects unemployment any time in 2021. For the tax credit, no matter how much they make on unemployment or otherwise, their income will not be counted higher than 133% of the federal poverty level. If you are collecting unemployment for 2021, it’s most likely beneficial to apply for Obamacare than Cobra. Why? Free Cobra payments are only good for 5 months, but with Obamacare, the Free to nearly Free health plans are good all year!
These changes do not apply to those Nevadan’s that have jobs that offer insurance to their employees and their families (whether they take their employer, spouses’ employer, parents insurance or not).
Full Premium Coverage for Unemployed Americans
The American Rescue Plan also includes a provision to let those receiving unemployment compensation in 2021 enroll get premium-free or nearly premium-free health insurance. Under this provision, anyone who received unemployment in 2021 will not have their income counted at more than 138% of the poverty level to determine how much of a subsidy they qualify for. This lets them qualify for a premium-free or nearly premium-free silver plan.
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COBRA Subsidies
The American Rescue Plan also helps people who lose their employment-based health insurance coverage, either because they lost their job or their hours were reduced, to keep their coverage for six months. The plan created a new subsidy that fully covers the cost of COBRA coverage from April 1 through September 30, 2021.
Extended Enrollment Deadlines
You may worry that quality health insurance is out of reach, especially if your salary is still lower than it was pre-COVID or you lost your job. Fortunately, the American Rescue Plan extended the deadline for the Special Enrollment Period/Open Enrollment Period through August 15, giving you more time to find a plan.
If you enrolled in a health insurance plan through Nevada Health Link, the platform automatically assesses whether you meet the new financial eligibility guidelines. If you previously requested subsidy assistance but were not eligible, you do not have to do anything. A health insurance agent can help you verify the automatic changes or request subsidy assistance for a new policy.
Are These Provisions Permanent?
These provisions are temporary, and when they run out depend on the subsidy.
The COBRA subsidy lasts through September 30, 2021.
The adjusted subsidy for unemployed Americans is only for 2021.
The eliminated subsidy cliff is for 2021 and 2022.
What If I Am Already Enrolled in a Plan?
If you are already enrolled, you can update your application and enrollment to get new eligibility. A health insurance agent can help you make necessary updates to take advantage of these subsidies.
What If I Qualify but Do Not Take Action?
Even if you do not take action, you will still benefit from these lower premiums. You will receive this additional benefit as part of your premium tax credit when you file your federal income taxes next year.
President Biden’s Future Plan For Health Insurance
In 2020, about 31 million Americans did not have health insurance coverage, and tens of millions more had inadequate coverage. President Biden has said that his plan for health insurance will cover more than 97% of Americans, providing affordable, robust coverage through a public option for individuals and families.
What Does President Biden’s Plan for Health Insurance Include?
President Biden’s plan for health insurance hinges on four pillars. These include a new Medicare-like public option for everyone, streamlined plans, more affordable drug prices and ensuring that health insurance remains accessible, regardless of preexisting conditions.
Creating a Public Health Insurance Option
A big part of President Biden’s plan involves a new public health insurance option similar to the current Medicare program. This option would be available to everyone, including those who buy health insurance on the Marketplace, who could get health insurance through their employer or who do not have coverage at all. Like Medicare, the public option would negotiate lower prices from healthcare providers and cover primary care services without copays. This would help individuals as well as small businesses who struggle to afford coverage for employees.
Streamlining Health Insurance Plans
If you have tried browsing health insurance plans without the help of a professional health insurance agent, then you already know how confusing they can be. Varying premiums, subsidies and benefits can make it hard to figure out just how much you will pay for health services under a given plan. President Biden’s plan for health insurance would make plans more affordable and easier to navigate.
Cutting Down on Prescription Drug Costs
President Biden plans to build on President Trump’s initiatives to lower prescription drug prices through a few measures, including increasing regulations, getting generics to market more quickly so patients have alternatives to expensive name-brand medications and increasing competition from international suppliers. Currently, drug corporations do not have to negotiate with Medicare over drug prices, letting them set whatever price they want for medications. President Biden intends to repeal this law. Additionally, consumers would be allowed to buy prescription drugs from other countries as long as the U.S. Department of Health and Human Services certified that the medications meet safety standards.
Keeping Health Care Accessible
President Biden’s plan includes keeping health care accessible by ensuring that those with preexisting conditions can continue to get health insurance that covers the condition and all complications related to it. His plan includes expanded funding for community clinics that provide affordable care for those without sufficient health insurance coverage. It also includes improving access to mental health services.
Affordable Health Insurance with Nevada Insurance Enrollment
The health insurance industry is ever evolving, and it can be difficult to stay up-to-date with the latest changes. There are numerous health insurance plans to choose from across several price points, each with its own set of benefits, and understanding your options can be a challenge.
At Nevada Insurance Enrollment, experienced health insurance agents assist you in comparing available policies and determine whether you qualify for cost-saving subsidies, helping you get comprehensive health insurance that fits your needs and budget.
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