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Subsidies

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More affordable insurance for Minnesotans

Starting in 2014, Minnesotans without access to affordable health insurance can purchase coverage through an Exchange. Depending on your income, you may qualify for two types of financial assistance: tax credits and cost-sharing subsidies. Minnesotans earning between 133 percent and 400 percent of the Federal Poverty Level (FPL) may be eligible for tax credits to help pay for health coverage through an Exchange. In 2012, that would mean individuals earning between $14,856 and $44,680 per year and a family of four earning between $30,656 and $92,200 per year would be eligible.

Tax credits will be advanceable, which means you get help at the time you purchase your plan without waiting until tax time. Credits will also be refundable so Minnesotans with low incomes who pay little or no federal income tax can still get assistance.

Another way insurance is made more affordable beginning in 2014 is through cost-sharing subsidies to help you avoid high out-of-pocket costs. Individuals and families who earn up to 250 percent of FPL — about $27,925 for an individual and $57,625 for a family of four in 2012 — will be eligible for cost sharing subsidies. This means you pay less in copayments, co-insurance and deductibles. 

What if I receive insurance from my employer, but still need help affording coverage? Can I qualify for a tax credit?

If Minnesotans meet certain criteria for unaffordable employer-sponsored coverage, they would be eligible to enroll in health insurance through an Exchange, and may be eligible for a tax credit depending on their income. These criteria include a person’s share of their employer-sponsored insurance premium that exceeds 9.5 percent of their income.

When are the subsidies available?

Subsidies will be available for eligible individuals and families purchasing health insurance through the Minnesota Health Insurance Exchange starting in January 2014.

Am I eligible for the subsidies?

U.S. citizens and legal immigrants who purchase coverage through the Minnesota Health Insurance Exchange and who earn between 133 and 400 percent of the federal poverty level (FPL) will be eligible to receive a tax credit. Those who purchase coverage through an Exchange and earn up to 250 percent of FPL would be eligible to also receive a cost-sharing subsidy to reduce copayments and deductibles.

What if I receive insurance from my employer, but still need help affording coverage? Can I qualify for a tax credit?

If Minnesotans meet certain criteria for unaffordable employer-sponsored coverage, they would be eligible to enroll in health insurance through an Exchange, and may be eligible for a tax credit depending on their income. These criteria include a person’s share of their employer-sponsored insurance premium that exceeds 9.5 percent of their income.

When are the subsidies available?

Subsidies will be available for eligible individuals and families purchasing health insurance through the Minnesota Health Insurance Exchange starting in January 2014.

Am I eligible for the subsidies?

U.S. citizens and legal immigrants who purchase coverage through the Minnesota Health Insurance Exchange and who earn between 133 and 400 percent of the federal poverty level (FPL) will be eligible to receive a tax credit. Those who purchase coverage through an Exchange and earn up to 250 percent of FPL would be eligible to also receive a cost-sharing subsidy to reduce copayments and deductibles.

What will my tax credit amount be?

The tax credit amount will vary based on an individual’s income and the premium of health insurance plans offered through an Exchange. The amount of the credit will roughly be the difference between the premium and what an individual is expected to contribute towards a health insurance premium (see chart below).

 

Income Level

Expected Contribution Toward Premium as a Percent of Income

100 – 133 % of FPL

2 % of income

133 – 150 % of FPL

3 – 4 % of income

150 – 200 % of FPL

4 – 6.3 % of income

200 – 250 % of FPL

6.3 – 8.05 % of income

250 – 300 % of FPL

8.05 – 9.5 % of income

300 – 400 % of FPL

9.5 % of income

 

How will I receive my subsidies?

Tax credits will be advanceable, which means you receive a credit at the time you purchase your plan through an Exchange. For individuals and families who have low incomes and pay little or no federal income tax, tax credits will be refundable so that they can still get help paying their premiums.