About Subsidy Calculator
Premium and subsidy calculator for the Affordable Care Act (Obamacare)
Update (8/24/2017): This calculator has been updated with 2017 rates and formulas.
This Subsidy Calculator is based on formulas and regulations defined by the Affordable Care Act (ACA/Obamacare). The law created a system that provides financial help to low and middle income families in the form of a “subsidy.” Subsidies are primarily based on two criteria: your eligible “cap rate” and the cost of the “second cheapest Silver Plan” in your area.
The premium cap rate limits how much money families have to pay for health insurance a month based on their income level relative to the official Federal Poverty Level (FPL). If an individual earns $24,000 a year, for example, they are 200% of the FPL and their premium cap rate is then defined by the ACA to be 6.43% of their income in 2017, or $129 per month. Cap rates are based on your FPL.
To then determine the subsidy amount, the government covers all costs above the price of the “second cheapest silver plan” in your area. So in the example above, if the second cheapest silver plan is $250 per month and your cap rate is $129 per month, your subsidy is then $121 per month. Note, if you choose a different type of plan, such as a Bronze or Platinum plan, your subsidy remains the same, $121.
The tax penalty for 2017 is 2.5% of the household’s gross income or $695 per uninsured adult and $347.50 per uninsured child, up to $2,085 per household, whichever is greater. Each year the penalty is capped based on the national average premium for bronze level insurance plans for single individuals and the number of people in the insurance unit. Specifically, the cap equals that average premium multiplied by the number of people in the household, up to a maximum of five people.
This tool is for research purposes only. The results shown are estimates and are calculated based on the information provided by the user and based on the data sets released to the public. Healthcare.gov and the Internal Revenue Service determines the final subsidy amount. HealthNetwork makes no representations or warranties about the accuracy of the information provided and we advise all users to confirm any research with their respective health insurance companies and health exchanges.