We’re not surprised! Recent rulings from the court of appeals have left many of us with more questions than answers about who’s able to receive premium tax credits to help pay toward their healthcare.
What are tax credits?
Premium tax credits lower the monthly cost of your health insurance. To qualify, you need to purchase your own insurance (not receive it through your employer) and have a household income under a set amount each year. Find out if you could qualify for tax credits here.
Why are they in the news?
There are a number of ongoing court cases related to tax credits- centering around who is eligible to receive them, based on how the Affordable Care Act was drafted. On Tuesday, July 22, two different appeal courts delivered rulings on this issue. One court, The US Court of Appeals for the District of Colombia, ruled that consumers can only receive tax credits if they live in a state which runs its own exchange. Washington State runs its own exchange and in 2014, so did Oregon.
The second court, the Fourth Circuit Court of Appeals in Richmond, VA, ruled that consumers in all states can receive subsidies – irrespective of whether their exchange is run by the state or they use the federal exchange, Healthcare.gov. In the Pacific Northwest, Alaska uses Healthcare.gov and Oregon is due to transition to Healthcare.gov for 2015 open enrollment.
What does this mean for consumers?
Right now – consumers won’t see any changes as a result of these rulings. The government announced that it intends to seek a review of the ruling delivered by the D.C Court of Appeals. If they are unsuccessful in that review, they still have the option to take the matter to the US Supreme Court, so the issue is a long way from being resolved.
For now the message is that consumers who qualify can still get tax credits no matter which state they live in.