It’s early. Even so, it’s not too early to look at what the pending Colorado health insurance open enrollment season (Nov 1st – Jan 15th) may include and how your premiums will be affected.
Because of the passage of the Inflation Reduction Act last month, there continues to be good news for Coloradans who can qualify for federal subsidies (a.k.a. tax credits) designed to offset increasing premiums for health insurance offered through the Colorado Marketplace (connectforhealthco.com).
In March 2021, the Covid Relief Bill expanded federal subsidies for health insurance, putting more middle and higher household income earners into the category of qualifying for an Advanced Premium Tax Credit (APTC). This was set to expire on December 31st, 2022. Now it’s been extended to December 31, 2025, within the Inflation Reduction Act.
These examples below are based on 2022 rates, but with the expanded federal subsidies for 2023, a subsidized plan should be priced similarly for January 1st coverage.
The General Rules of Thumb:
- Less household income = greater federal subsidies available – sometimes the subsidies are large enough that a $0 monthly premium is due.
- Silver Marketplace plans frequently have the greatest value. Bronze plans are even less expensive.
- Generally, greater subsidy amounts are available in the mountains because health insurance premiums are more expensive in Vail, Steamboat, Aspen, Crested Butte, etc.
What is the practical reality?
NOTE: Estimates below can vary by Colorado zip code and region of the state as well as the insured’s age. Subsidy amounts are also greater for older applicants, again because health insurance premiums are more expensive for older individuals.
#1) Married couple, two early retirees or two self-employed people, may now qualify for a federal subsidy even if their household income exceeds $200,000.
Example: Denver household of two 60-year-olds: $530 monthly tax credit available at an estimated annual household income of $120,000. Silver plan premium starts at $830/MO (in total) for the couple after the federal subsidy has been accounted for.
Example: Vail household of two 60-year-olds: $1,050 monthly tax credit available at an estimated annual household income of $120,000. Silver plan premium starts at $814/MO (in total) for the couple after the federal subsidy has been accounted for.
#2) Husband and wife, plus two children, may now qualify for a subsidy even if their household income exceeds $150,000.
Example: Denver household of four, two 50-year-olds and two teenagers: $322 monthly tax credit available at an estimated annual household income of $140,000. Silver plan premium starts at $974/MO (in total) for the family after the federal subsidy has been accounted for.
Example: Vail household of four, two 50-year-olds and two teenagers: $818 monthly tax credit available at an estimated annual household income of $140,000. Silver plan premium starts at $958/MO (in total) for the four of them after the federal subsidy has been accounted for.
#3) A single man or woman, age 61, may now qualify for a federal subsidy up to $100,000 in annual income.
Example: Denver household of one, age 61: $218 monthly tax credit available at an estimated annual income of $70,000. Silver plan premium starts at $487/MO for an individual after the federal subsidy has been accounted for.
Example: Vail household of one, age 61: $488 monthly tax credit available at an estimated annual income of $70,000. Silver plan premium starts at $477/MO for an individual after the federal subsidy has been accounted for.
#4) Married couples, with a very low income, may qualify for a nearly fully subsidized Silver health insurance plan.
Example: Denver household of two 45-year-olds: $699 monthly tax credit available at an estimated annual income of $32,000. Silver plan premium starts at $25/MO (in total) for the couple after the federal subsidy has been accounted for. Plus, CSR (cost sharing reduction) is included – an extra level of subsidy – reducing their deductible to $200 per person.
Example: Vail household of two 45-year-olds: $976 monthly tax credit available at an estimated annual income of $32,000. Silver plan premium starts at $16/MO (in total) for the couple after the federal subsidy has been accounted for. Plus, CSR (cost sharing reduction) is included – an extra level of subsidy – reducing their deductible to $0.