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Inflation Reduction Act preserves health insurance subsidy until 2025 [The Philadelphia Inquirer] – InsuranceNewsNet

August 15 – The improved tax credits that have helped thousands of people afford health insurance during the COVID-19 pandemic will continue through 2025 under the Cut Inflation Act, which received final approval on Friday from Congress.

Premium tax credits for people who take out health insurance through health.gov or state-based markets – such as Pennie.com and GetCoveredNJ — were expanded during the pandemic to make health insurance more accessible to people who had lost their jobs or experienced a drop in income. The credits were due to expire in 2023, which would have exposed people to big premium increases next year.

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Previously, tax credits were available to people whose income was less than 400% of federal poverty, about $51,500 for an individual in 2022, to help offset the cost of premiums for health insurance plans purchased in the federal and state markets.

Fearing that unemployment and reduced wages during the pandemic could lead to a spike in the rate of uninsured people, lawmakers in 2021 increased the amount of tax credits and removed the income cap that limited those eligible.

Individuals would have paid on average 53% more — a supplement $700 one year – for their insurance premium in 2022 without the expanded tax credits, according to a new analysis of the Kaiser Family Foundation.

Between 2021 and 2022, Pennsylvania saw an 11% increase in the number of people who signed up for a health plan through Pennie.com. In New Jersey, the number of people enrolled in a market plan increased by 20%, as more people found affordable coverage. Both Pennsylvania and New Jersey extended special enrollment periods to allow people who had lost coverage during the pandemic to enroll.

For people looking to retain their market coverage in 2023, the continuation of improved tax credits will soften the blow from expected premium increases, according to the KFF report.

According Kaiser Family Foundation.

Pennsylvania market, Pennie.comand from New Jersey marketplace, GetCoveredNJ, open for 2023 plan enrollment on November, 1st.

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