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Health Insurance Subsidy Income Limits For 2024

Health insurance subsidies are a form of financial assistance offered through the Affordable Care Act (ACA). The subsidies are designed to help you manage the cost of your health insurance premiums. The amount of aid you’re eligible for depends on household size and household income, helping to ensure that individuals with lower earnings receive the substantial financial support they need.

As we look ahead to 2024, it’s important to note the following key figures:

  • Individuals purchasing the benchmark Marketplace insurance plan (typically the second-lowest-cost silver plan) do not have to pay more than 8.39% of their household income for their monthly premiums. 
  • Individuals with household income at or below 150% of the federal poverty level (FPL) pay $0 for the benchmark plan.
  • Maximum out-of-pocket (OOP) costs (copayment, coinsurance, deductibles) for Marketplace coverage is $9,450 for self-only plans and $18,900 for family plans. Cost-sharing reductions may significantly lower OOP costs. 

Throughout this guide, we explore the 2024 income limits, eligibility criteria, and more, providing you with the information needed to make critical decisions regarding your health insurance coverage.  

ACA Income Limits for 2024  

Eligibility for 2024 ACA subsidies is determined by comparing your expected 2024 income to the federal poverty levels set in 2023. Subsidies are scaled based on where your income level falls within the designated poverty levels, as shown in the table below.

Household Size
2023 Income
2023 Income for Alaskan Residents
2023 Income for Hawaiian Residents
Individuals
$14,580
$18,210
$16,770
Family of 2
$19,720
$24,640
$22,680
Family of 3
$24,860
$31,070
$28,590
Family of 4
$30,000
$37,500
$34,500
Family of 5
$35,140
$43,930
$40,410
Family of 6
$40,280
$50,360
$46,320
Family of 7
$45,420
$56,790
$52,230
Family of 8
$50,560
$63,220
$58,140
Family of more than 8
Add $5,140 per additional person
Add $6,430 per additional person
Add $5,910 per additional person

Premium Tax Credits

Premium tax credits are discounts applied directly to health insurance premiums for plans purchased through the Health Insurance Marketplace. The amount of the credit depends on several factors, including your household income, the size of your family, and the cost of Marketplace plans in your area.

ACA healthcare plans are divided into metal tiers: bronze, silver, gold, and platinum. Bronze plans have low monthly premiums and high out-of-pocket costs, while platinum plans have higher premiums and lower out-of-pocket costs. The other two plans fall in between.

The amount of subsidy an individual changes based on their expected household income for the upcoming year. Suppose you’re expected to make between 100% and 150% of the poverty level in 2024. In that case, the expected contribution for the benchmark plan (the second-lowest-cost silver plan available in the Marketplace in your area) is $0. In this case, you can access the benchmark plan without having to pay a monthly premium. 

Households earning over 400% of the FPL are expected to pay 8.5% of their income to cover health insurance premiums. The subsidy is based on a sliding scale for incomes that fall between 151% and 400% of the poverty level. If the Marketplace health insurance exceeds your expected contribution limit, subsidies are generally available to offset the difference.

While premium tax credits are based on the cost of the benchmark plan, the credits can be applied to any of the different levels of coverage. The following table shows the expected contribution limits for 2024. 

Household Income
Expected Contribution
Up to 150% of FPL
0% of your income (no premium for benchmark plan)
151% to 200% of FPL
0% to 2% of your income
201% to 250% of FPL
2% to 4% of your income
251% to 300% of FPL
4% to 6% of your income
301% to 350% of FPL
6% to 8.5% of your income
400% of FPL or higher
8.5% of your income

Eligibility Criteria  

To be eligible for premium tax credits, you must meet the following criteria:

  • Your household income falls within the Obamacare income limits for 2024.  
  • No household member has access to affordable coverage that provides minimum value through an employer.
  • You are not eligible for Medicare, Medicaid, or the Children’s Health Insurance Program (CHIP).
  • You are a U.S. citizen or have proof of legal residency.
  • If you are married, you file your taxes jointly with your spouse.

The following table indicates the ACA income limits for 2024:

Household Size
100% FPL
138% FPL
150% FPL
200% FPL
250% FPL
300% FPL
400% FPL
Individuals
$14,580
$20,120
$21,870
$29,160
$36,450
$43,740
$58,320
Family of 2
$19,720
$27,214
$29,580
$39,440
$49,300
$59,160
$78,880
Family of 3
$24,860
$34,307
$37,290
$49,720
$62,150
$74,580
$99,440
Family of 4
$30,000
$41,400
$45,000
$60,000
$75,000
$90,000
$120,000
Family of 5
$35,140
$48,493
$52,710
$70,280
$87,850
$105,420
$140,560
Family of 6
$40,280
$55,586
$60,420
$80,560
$100,700
$120,840
$161,120
Family of 7
$45,420
$62,680
$68,130
$90,840
$113,550
$136,260
$181,680
Family of 8
$50,560
$69,773
$75,840
$101,120
$126,400
$151,680
$202,240

Eligibility for Those With Employer-Sponsored Plans  

If your employer offers affordable health insurance you may not be eligible for a 2024 subsidy, even if you fall within the ACA income limits for 2024. To be considered affordable, in 2024, the monthly premiums must be no more than 8.39% of household income. If self-only coverage is less than 8.39%, but family coverage costs more, dependents can purchase subsidized coverage on the exchange while the employee remains on their employer coverage.

To meet the minimum value requirement, employer-offered plans must provide substantial coverage for both inpatient hospital care and physician services. In addition, the plan must pay a minimum of 60% of the combined cost, which is similar to a bronze Marketplace plan. In addition, in 2024, the plan must have an annual out-of-pocket maximum of $9,450 for an individual or $18,900 for a family.

If an employer offers a health insurance plan that does not meet the requirements. In that case, an employee can qualify for premium tax credits as long as they meet the other eligibility requirements.

Eligibility for Those With Medicaid  

Medicaid eligibility varies by state. Generally, those who are eligible for Medicaid are not eligible for Marketplace subsidies, as Medicaid typically offers financial assistance greater than the amount of the subsidy.

Many states have expanded Medicaid coverage, offering it to those with incomes of up to 138% of the federal poverty level ($20,120 for an individual in 2024). In states without expanding Medicaid eligibility, households with incomes as low as 100% of the federal poverty level can qualify for Marketplace subsidies. However, those with income below this level are not eligible for subsidies and are generally also not eligible for Medicare. This creates a coverage gap that currently impacts approximately 1.9 million Americans

Eligibility for CHIP varies by state. However, it tends to be more lenient than Medicaid eligibility, meaning households with higher incomes may still receive CHIP coverage. When children are eligible for CHIP, they are not eligible for subsidies. However, adults in the household may still be eligible for subsidies. 

Cost-Sharing Reductions

Cost-sharing reductions are another form of financial assistance that may be available for individuals purchasing health insurance on the Marketplace. Cost-sharing reductions help keep healthcare affordable by lowering out-of-pocket expenses such as copayments, coinsurance, and deductibles on silver-level plans, bringing them more in line with the OOP costs for a gold or platinum plan.

The amount of the cost reduction depends on household income and is adjusted on a sliding scale. Depending on where a household falls on the FPL scale, an individual may be eligible for a CSR 94 Silver Plan, a CSR 87 Silver Plan, or a CSR 73 Silver Plan. These numbers refer to the plan’s actuarial value, which refers to the average percentage of costs the plan shares. Each plan also has different OOP limits.

Eligibility Criteria  

To be eligible for cost-sharing reductions, you must meet the following criteria:

  • Your household income falls between 100% and 250% of the federal poverty level.
  • You’re enrolled in a silver-level Marketplace plan.

Individuals with household incomes that fall within the required range can continue applying the premium tax credit (subsidies) to any level plan. However, cost-sharing reductions only apply if you choose a silver-level plan.

Under the ACA, plans also have OOP spending limits that apply regardless of household income. In 2024, Marketplace plans cap annual OOP spending at $9,450 for self-only plans and $18,900 for family plans. The following table illustrates how cost-sharing reductions impact OOP spending limits at various income levels. 

Household Income
Plan Type Available
2024 Max Annual OOP: Self-Only Plans
2024 Max Annual OOP: Family Plans
All income levels
All Plans
$9,450.00
$18,900.00
100% to 150% of FPL
CSR 94
$3,150.00
$6,300.00
151% to 200% of FPL
CSR 87
$3,150.00
$6,300.00

How to Calculate Your Modified Adjusted Gross Income (MAGI)

Eligibility for premium tax credits and cost-sharing reductions is based on your household’s modified adjusted gross income (MAGI) rather than the income stated on your tax return. When applying for Marketplace health insurance, you must estimate your household’s MAGI for the upcoming year.  

MAGI starts with your adjusted gross income (AGI), which is your gross income adjusted for things like student loan interest, educator expenses, alimony payments, and retirement plan contributions. MAGI adds some of these deductions back in, potentially creating a larger baseline income amount. 

Included in MAGI  

When calculating MAGI, the following items are included in household income:

  • Federal taxable wages (income from your job)
  • Tip income
  • Self-employment income (business income minus business expenses)
  • Unemployment compensation
  • Taxable and non-taxable Social Security income (before deductions)
  • Social Security Disability Income (SSDI)
  • Retirement or pension income, including IRA and 401(k) withdrawals
  • Capital gains income
  • Investment income, including tax-exempt interest
  • Net rental and royalty income
  • Alimony income for divorces finalized before Jan. 1, 2019
  • Untaxed foreign income

Generally, household income is calculated based on the MAGI of all household members, including the tax filer, their spouse, and each tax dependent that is required to file a tax return, even if the dependents do not need health insurance coverage.

Excluded From MAGI  

Certain items are excluded from your MAGI, including:

  • Supplemental Security Income (SSI)
  • Qualified distributions from a designated Roth account
  • Alimony payments for divorces settled after Jan. 1, 2019
  • Child support received
  • Gifts received
  • Veterans’ disability payments
  • Worker’s compensation payments
  • Proceeds from loans (ex. bank loans, home equity loans, student loans)
  • Child Tax Credit checks or other deposits received from the IRS

How to Calculate Your Potential Subsidy Savings  

You can calculate your potential premium tax credit for 2024 by following these four steps:

  1. Determine your projected 2024 household income and compare it to the 2023 federal poverty levels to see where your income falls within the subsidy eligibility range.
  2. Check the expected contribution percentage for your income level, which dictates how much of your income you’re expected to contribute toward your health insurance premiums.
  3. Identify the cost of the second-lowest-cost silver plan in your area, as this is the benchmark for calculating subsidies.
  4. Subtract your expected contribution (determined in step 2) from the total cost of the benchmark plan. The result is your estimated subsidy amount.

See It in Action  

Assume the benchmark silver plan in your area costs $5,000 per year. If you’re at 200% of the FPL, you’re expected to contribute 2% of your income. Assuming your income is $30,000, your contribution would be $600. So, your subsidy would be the plan cost minus your contribution: $5,000 – $600 = $4,400.

Over the year, the $4,400 is applied to your premiums, reducing your monthly payments so that you pay a total of $600 for the year.

Putting It All Together  

When purchasing health insurance from the Marketplace, it’s important to understand the financial assistance available and the eligibility requirements. Premium tax credits and cost-sharing reductions can both make health insurance more affordable and accessible for individuals and families.

Keep in mind that eligibility for financial assistance is based, in part, on the modified adjusted gross income (MAGI) for all household members, including dependents who are required to file a tax return, even if they do not need health insurance coverage.

You can easily calculate your potential subsidy savings by following the four steps listed above. However, if you need additional help, you can seek assistance from a qualified health insurance specialist.

Frequently Asked Questions

If you underestimate your income, you may receive a larger subsidy than you’re entitled to. When you file your tax return, you may have to repay some or all of the excess amount received.

Overestimating your income could mean you receive a smaller subsidy than you qualify for. If this happens, you may be eligible for a tax credit when you file your taxes, potentially leading to a refund or a reduction in the amount of tax you owe.

Marriage or divorce can significantly impact your ACA income calculations, as your subsidy is based on household income. A change in marital status also alters your household size and the income threshold for subsidy eligibility. For these reasons, it’s important to report changes promptly so your subsidy can be adjusted accurately. 

If you disagree with the subsidy amount, you have the right to appeal the decision. You can typically start this process by contacting the Health Insurance Marketplace where you purchased your plan. They can guide you through the appeal, which may include submitting documentation or participating in a hearing.

Yes. If there are changes in household status, report it to the Health Insurance Marketplace as soon as possible. You can typically do this online, over the phone, or in person. Updating your income details helps ensure your subsidy amount is accurate and can prevent financial surprises during tax season.

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