Urban Institute New Report: Rural Residents Most Likely to Benefit from Enhanced ACA Subsidies

From FIERCE Healthcare

Rural residents were the most likely to benefit from enhanced subsidies for Affordable Care Act coverage and face the greatest danger of losing coverage if those benefits expire after this year, a new study finds.

The study, released by the Robert Wood Johnson Foundation Tuesday, comes as healthcare groups are making a major effort to get Congress to renew the boosted subsidies. ACA enrollment grew to a record-setting 14.5 million people this year thanks in part to the higher subsidies.

“The enhanced premium subsidies have been transformational in high-cost rural areas,” said Kathy Hempstead, Robert Wood Johnson’s senior policy adviser, in a statement. “If the tax credits are allowed to expire, rural residents will have few if any policies to choose from that are both affordable and comprehensive.”

Researchers with the Urban Institute on behalf of the foundation looked at average benchmark premiums across several states on the ACA exchanges. The benchmark plan—which is the second-cheapest silver tier plan—is what the federal government uses to calculate income-based subsidies. The government ties the benchmark premium to a certain percentage of the household income.

“Because the percentage-of-income caps do not vary with premiums, the higher the benchmark premium, the greater the size of the federal government’s premium contribution for the household,” the study said.

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