Health Insurance

What Are The Obamacare 2023 Subsidies By Income Level?

Alexandra Thompson
Alexandra Thompson17 Nov 2022

Under the Affordable Care Act ( ACA), eligible individuals and families can apply subsidies to reduce the cost of purchasing health insurance in the federal or state marketplace. Under the ACA, there are two types of subsidies: Cost Sharing Reductions and Advanced Premium Tax Credits. According to Kaiser Family Foundation, premium tax credits are the most popular subsided with the average monthly credit of about $486

Qualifying for Subsidies 

Of the two types of subsidies established under the Affordable Care Act, Premium tax Credits are the most popular option. To qualify for the premium tax credit, individuals or families must have a net income between 100 percent and 400 percent of the federal poverty line. Depending on where your income falls within the federal poverty line threshold, your expected premium contributions for your insurance can be between 0% and 8.5% of your total income. Alaska and Hawaii are the exceptions to the standardized FPL guidelines as the income limits, threshold, and poverty line are higher in those states

The chart below shows the FPL guidelines by the number of people in a household and income level ( FPL percentage). The second chart, expected premium contributions, outlines the premium amount, by percentage, based on where your income falls on the federal poverty line. 

2023 Federal Poverty Guidelines

# of People in Household 100% of FPL 150% of FPL 200% of FPL 250% of FPL 300% of FPL 400% of FPL 
1$ 13,590$ 20,385$ 27,180 $ 33,975$ 40,770$ 54,360
2$ 18,310$ 27,465 $ 36,620$ 45,775$ 54,930$ 73,240
3$ 23,030$ 34,545$ 46,060$ 57,575$ 69,090$ 92,120 
4$ 27,750$ 41,625$ 55,500$ 69,375 $ 83,250 $ 111,000
5$ 32,470$ 48,705$ 64,940$ 81,175$ 97,410 $ 129,880
6$ 37,190$ 55,785$ 74,380$ 92, 975$ 111,570$ 148, 760 
7$ 41,910$ 62, 865$ 83,820$ 104,775$ 125,730$ 167,640 
8$ 46,630 $ 69, 945 $ 93,260$ 116,575$ 139, 890$ 186, 520 

Expected Premium Contributions   

Annual Household Income (%of FPL)Up to 150% of FPL 200% FPL250% FPL300% FPL 400% FPL & Above 
Expected Premium Contributions   0%2%4%6%8.5%

For example, an individual living in Texas has an annual income of about $35,000. This income would be between 250 and 300 percent of the federal poverty line. Therefore he expected premium contribution would be between 4% and 6% or $1,400 ($116 per month) and $2,100 ($175 per month)   

What is the Difference Between Cost Sharing Reductions (CSR) and Premium Tax Credits? 

Cost-sharing reductions (CSR) are a discount that lowers the amount you pay for deductibles, coinsurance, and copayments with marketplace-based health insurance. Premium tax credits are used to lower your monthly insurance payment or premium when you enroll in a marketplace plan. 

CSR has greater restrictions than premium tax credits. If you qualify for CSR, savings can only be applied if you choose a Silver marketplace plan. With CRS, you will have a lower out-of-pocket maximum (the amount you pay for services before insurance coverage starts) and have 100% coverage of all covered services once the maximum is reached.  

With a premium tax credit, the saving amount can be used with any metal marketplace plan.   

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What is the Average Premium Tax Credit in My State? 

The nationwide average tax credit is about $486. On a state-by-state basis, that number can differ depending on if the state uses the federal marketplace or state-based option, variation in income level, and state-wide criteria for Medicaid. The chart below provides the average premium tax credit by state

Average Monthly Advanced Premium Tax Credit By State 

Location (State) Average Monthly Advanced Premium Tax Credit 
Arizona $449
Arkansas $452
California $476
Colorado $374
Connecticut $657
Delaware $607
District of Columbia $343
Florida $553
Georgia $466
Illinois $509
Iowa $598
Kansas $532
Kentucky $485
Louisiana $658
Maryland $375
Massachusetts $377
Michigan $392
Minnesota $343
Mississippi $570
Missouri $548
Montana $501
Nebraska $615 
Nevada $435 
New Hampshire $337
New Jersey $490
New Mexico $472
New York $362
North Carolina $581
North Dakota $452
Oklahoma $559
Pennsylvania $500
Rhode Island $402
South Carolina $513
South Dakota $642
Tennessee $545
Utah $370
Vermont $566
Virginia $508
Washington $421
West Virginia $1,007
Wisconsin $531
Wyoming $531 

Source: Kaiser Family Foundation 

 Frequently Asked Questions FAQ(s) on Obamacare Subsidies  

The questions below cover frequently asked questions on the different types of subsidies, qualification criteria, and how to apply in the marketplace. 

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Who Qualifies for Premium Tax Credits and Other Subsidies?  

To qualify for ACA-based subsidies and premium tax credits, you must be an American citizen or a legal non-citizen who does not have access to affordable healthcare through an employer health plan, Medicaid, or Medicare. You do not qualify for ACA subsidies if you are:  

  • Married and filing taxes separately or refuse to file income tax
  • You are incarcerated
  • You have access to affordable employer-sponsored insurance but want to purchase family insurance but can’t afford family coverage under your employer plan. (Affordable employer-sponsored group health coverage: is an employee insurance plan that does not cost more than 9.61 percent of your household income.)  

How Are Tax Credits Applied to Monthly Cost? 

There are two ways that premium tax credits can be applied to your monthly or annual premium cost for your health plan after your application through the marketplace is processed:

  1. The tax credit is applied throughout the year and paid directly to your health insurance to reduce the premium of your coverage.
  2. You pay your premium in full monthly and receive a lump sum tax credit when you file your income taxes.

Taking the first option comes with a few terms and conditions you should be aware of. If you underestimate your annual income, you will owe money back at the end of the year. If you overestimate your income, you will receive an adjusted tax credit refund when you file your income tax.   

How to Apply for ACA Subsidies?  

You can apply for ACA subsidies through the government-based health insurance marketplace and state-specific marketplaces. This can be completed when you apply for your health insurance plan during the enrollment period. It's important to note that the government will make the final determination as to whether or not you are eligible for a subsidy. 

Bottom Line  

ACA subsidies are a great way to reduce the monthly cost of marketplace health insurance for individual or family plans. Before you apply for insurance during this open enrollment period, check to see if you meet the general eligibility criteria and where your annual income falls on the FPL spectrum. As we prepare for an upcoming recession, saving money on premiums, copayments, deductibles, or coinsurance is more important than ever. If you are looking for an alternate way to save money while still accessing affordable care, Mira could be right. For an average of $45 per month, you get access to low-cost urgent and virtual care, lab testing, and prescriptions. Sign up Today! 

Alexandra Thompson

Originally from Houston, Texas, Alexandra is currently getting her Master's in Public Health with a health policy certificate at Columbia University. One of her life goals is to own her own art gallery!