Comprehensive Guide
Learn more in our Insurance Guide.
How it works
Under the Affordable Care Act, marketplace plans are priced as a share of your income, with the federal government paying the difference between that cap and the benchmark silver plan premium. The calculator finds your household's income as a percentage of the federal poverty level (using the 2026 guideline), applies the contribution scale — from 2% of income at the lowest tier up to about 8.5% above 400% FPL — and estimates the subsidy as the gap between the benchmark premium and your cap. Two subtleties matter: the subsidy is calculated on the benchmark silver plan, not the plan you actually pick (cheaper plans can cost less than the cap, more expensive ones above it), and the number is an estimate — final eligibility depends on the exchange, your state and the exact benchmark premium at enrolment. The engine shows your ratio, so you can see which tier your household sits in.Formula
Contribution cap = income x scale(FPL ratio) | Subsidy = benchmark premium - cap
Tips
- Project current-year income carefully — underestimating can mean repaying subsidies at tax time.
- The subsidy applies to the benchmark silver plan; bronze plans are often cheaper than your cap.
- Report life changes (a new job, a baby) immediately — subsidy eligibility is retroactive.
- Silver plans with cost-sharing reductions are worth comparing for households under 250% FPL.
Frequently asked questions
Am I eligible for a health insurance subsidy?
If your household income is between 100% and 400% of the federal poverty level and you buy through the marketplace, you likely qualify for a premium tax credit. Under 100% FPL, Medicaid eligibility differs by state — most states cover you, many still do not.
What is the benchmark plan?
The second-lowest-cost silver plan in your area. Your subsidy is calculated against its premium; choosing a cheaper plan means your net cost can drop below the cap, and a pricier plan means you pay more than the cap yourself.
What if my income changes mid-year?
Update your marketplace application within 30 days of any change — a raise, a lost job, a marriage. Subsidy amounts are reconciled on your tax return, and underpaying estimates can create a repayment owed at filing.
Do I have to repay the subsidy if my estimate was wrong?
It depends on how far the estimate missed. Small under-200% FPL errors are forgiven; larger discrepancies are reconciled at tax time. Conservative income estimates that err upward are safer than optimistic ones.