Health insurance will be free for some Americans on the new Affordable Care Act exchanges, according to a Health and Human Services analysis released Wednesday on insurance costs.
The average premium works out to zero after the tax subsidy for a family of four earning $50,000 a year on the lowest-cost bronze plan in Fairfax County, Virg., Jackson, Miss., and Anchorage, Ala., the HHS said. That's because they will qualify for enough tax subsidies to cover the entire cost of the plan.
"Yes, people can get a zero premium bronze plan after the tax credit," said Gary Cohen, director of the Center for Consumer Information and Insurance Oversight at the Centers for Medicare and Medicaid Services, who is responsible for implementing the exchanges.
The zero-dollar price tag also means that some families will pay less than individuals for coverage.
"Because premiums for older individuals and families are higher than those for younger individuals, tax credits are larger for older individuals and families," the report says. "Therefore, using tax credits to purchase a bronze plan may yield lower bronze premiums for older individuals and families than for younger individuals."
It is unclear how many families will be eligible for such a deal, and if there are other income brackets that will also qualify. In Fairfax County, Virg., for instance, a 27-year-old making $25,000 per year would pay $66 per month for the lowest cost bronze plan coverage and that family of four making $50,000 would pay $282 per month if they chose to enroll in second-lowest silver plan coverage, according to the HHS report.
The study includes new data from states with federally-run exchanges. Complete details about premiums and plan offerings will be available, Cohen said, once the exchanges open for enrollment on Oct. 1.