Everyone has a close eye on the new ACA Health Insurance Marketplaces, especially how many Americans will purchase a health plan through the Marketplaces and how many Americans will access the new premium tax subsidies. According to a recent analysis by Kaiser Family Foundation (KFF), an estimated 17 million Americans who are now uninsured or who buy insurance on their own will be eligible for premium tax subsidies in 2014. Additionally, 29 million people nationally may look to the Marketplaces to purchase health insurance coverage. Here's a look at the analysis of the premium tax subsidy eligibility, including eligibility by state.
17 Million People Eligible for Premium Tax Subsidies
The analysis by KFF found that 17 million Americans are eligible for premium tax subsidies. Here's how they got to this number.
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The analysis started with the pool of Americans who either do not have insurance or who purchase non-group insurance (individual health insurance, etc.).
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The analysis assumed that people who are covered by a public program or by employer-based (group) coverage will retain their coverage and would not be eligible for premium tax subsidies.
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Two other groups of people were then removed from the potential pool of tax-subsidy eligible individuals: (1) uninsured adults and children whose incomes would make them eligible for Medicaid or CHIP, and (2) people who are not legally residing in the United States. Neither group is eligible for premium tax subsidies under the ACA.
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For those remaining in the pool, KFF looked at their family incomes under ACA rules and the premiums that they would face for benchmark coverage to determine whether they would qualify for a premium tax subsidy.
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The vast majority of potential eligibles with incomes between 100% and 400% of poverty would qualify for premium tax subsidies.
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Finally, KFF removed approximately 16% of potential eligibles because research shows that some people who are uninsured or have non-group coverage have access to employer-based coverage, either through an offer from their own employer or through an offer through a spouse or parent.
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Those that remained in the potential pool constituted their estimate of tax-subsidy eligible individuals.
Based on these assumptions, KFF estimated that over 17 million Americans will be eligible for tax subsidies in 2014.
Estimated Number of Tax Subsidy Eligible Individuals By State
According to the analysis, three states (Texas, California, and Florida) each have more than 1 million residents eligible for tax subsidies, and seven states have more than 500,000 residents eligible (Georgia, North Carolina, Ohio, Pennsylvania, and Virginia). On the flip side, seven states have fewer than 50,000 residents eligible, with the District of Columbia (9,500) and Vermont (27,000) having the fewest. The five states with the most tax-credit-eligible individuals account for about 40 percent of all such individuals nationally.
Number of Tax Subsidy Eligible Residents |
Potential Market Size |
|
National |
17,187,000 |
28,605,000 |
Alabama |
270,000 |
464,000 |
Alaska |
55,000 |
78,000 |
Arizona |
313,000 |
551,000 |
Arkansas |
150,000 |
227,000 |
California |
1,903,000 |
3,291,000 |
Colorado |
254,000 |
501,000 |
Connecticut |
109,000 |
216,000 |
Delaware |
29,000 |
48,000 |
District of Columbia |
9,000 |
36,000 |
Florida |
1,587,000 |
2,545,000 |
Georgia |
654,000 |
1,063,000 |
Hawaii |
29,000 |
58,000 |
Idaho |
130,000 |
202,000 |
Illinois |
501,000 |
937,000 |
Indiana |
354,000 |
525,000 |
Iowa |
127,000 |
262,000 |
Kansas |
161,000 |
298,000 |
Kentucky |
192,000 |
302,000 |
Louisiana |
344,000 |
489,000 |
Maine |
77,000 |
122,000 |
Maryland |
201,000 |
419,000 |
Massachusetts |
118,000 |
259,000 |
Michigan |
436,000 |
725,000 |
Minnesota |
90,000 |
298,000 |
Mississippi |
204,000 |
298,000 |
Missouri |
386,000 |
657,000 |
Montana |
97,000 |
152,000 |
Nebraska |
122,000 |
239,000 |
Nevada |
155,000 |
249,000 |
New Hampshire |
81,000 |
137,000 |
New Jersey |
400,000 |
628,000 |
New Mexico |
118,000 |
193,000 |
New York |
779,000 |
1,264,000 |
North Carolina |
684,000 |
1,073,000 |
North Dakota |
43,000 |
77,000 |
Ohio |
544,000 |
812,000 |
Oklahoma |
256,000 |
446,000 |
Oregon |
187,000 |
337,000 |
Pennsylvania |
715,000 |
1,276,000 |
Rhode Island |
40,000 |
70,000 |
South Carolina |
336,000 |
491,000 |
South Dakota |
70,000 |
118,000 |
Tennessee |
387,000 |
645,000 |
Texas |
2,049,000 |
3,143,000 |
Utah |
206,000 |
331,000 |
Vermont |
27,000 |
45,000 |
Virginia |
518,000 |
823,000 |
Washington |
272,000 |
507,000 |
West Virginia |
71,000 |
117,000 |
Wisconsin |
301,000 |
482,000 |
Wyoming |
47,000 |
80,000 |
Source: KFF analysis
According to Kaiser Family Foundation, the analysis used pooled data from the 2012 and 2013 Current Population Survey (CPS) Annual Social and Economic Supplement (ASEC). The CPS ASEC provides socioeconomic and demographic information that can be used for national and state estimates. Read more about the analysis methodology here.
29 Million Americans May Look to New Marketplaces for Coverage
According to the analysis, 29 million Americans may look to the marketplaces for coverage. To get to this number, KFF made the following assumptions:
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The potential market for coverage in marketplaces started with current non-group purchasers and uninsured people who are legally residing in the United States and who are not eligible for Medicaid or CHIP.
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They excluded two groups from among the current uninsured. The first group is people with incomes above Medicaid eligibility levels but below poverty, referred to as the gap group. They also excluded current uninsured people who are in a household of a full-time worker who either has or is offered employer-based insurance. As noted above, these people would be ineligible for premium tax credits, so the assumptions was made that they would choose employer-based coverage rather than non-group coverage if they choose to become insured.
According to KFF, the largest potential markets are in the states with the largest tax-subsidy eligible populations: California, Texas, and Florida. Six states have a potential market of more than 1 million people, and another 12 have a potential market of more than 500,000 people.
Where does your state fall? Leave a comment below.