F is for Federal Poverty Levels

May 2, 2017

 

For better or worse, health insurance has been in the news a lot lately, so we are continuing our series to help you understand different terms that may come up.  

 

 

The Federal Poverty Level doesn’t seem like it is something that impacts insurance but it does.  These numbers are used as a guideline for administrative purposes such as determining eligibility for federal programs.  Your household income helps determine whether you qualify for Medicaid, tax credits, and/or Cost Share Reductions.  Cost share reductions lower your out of pocket costs for medical care, and will be addressed in another post.

 

Washington state participated in the Medicaid expansion, so here’s how your income impacts the help you get with your insurance:

 

Income:                You may be eligible for:

< 138% of FPL:          Apple Health, Medicaid – no cost coverage

138 – 250% FPL:       Tax Credits and Cost Share Reductions

250% - 400% FPL:    Tax Credits

 

Here are the current FPL Guidelines.

So how would this work in real life?  The FPL is $12,060 for a single adult, and $24,600 for a family of 4.

 

If you are a single adult and your income is:

 

< $16,643 per year                            You should qualify for Medicaid (Apple Health)

$16, 643 - $30,150                              You should receive Cost Share Reductions and may                                                                             receive tax credits

$30,150 - $48,240                               You may receive tax credits

>$48,240                                              You pay full price for your insurance

 

 

For a family of 4:

 

< $33,948 per year                            You should qualify for Medicaid (Apple Health)

$33,948  - $61,500                              You should receive Cost Share Reductions and may                                                                             receive tax credits

$61,500 - $98,400                               You may receive tax credits

>$98,400                                              You pay full price for your insurance

 

Please bear in mind that this is an over-simplification of the process.  Your income is just one piece of the puzzle in determining tax credits.  Other things that will impact eligibility include your citizenship/resident status, whether you have access to coverage through your employer, what percentage of your income the insurance premium represents, whether you are pregnant,  or under 18.

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