From 2021 through 2025, enhanced subsidies capped Marketplace premiums at 8.5% of income for most enrollees. Those enhanced premium tax credits expired December 31, 2025, and Congress has not extended them. Pre-ARPA rules are back: subsidies cut off at 400% of the Federal Poverty Level, required contribution percentages went up, and KFF estimates average net premiums for subsidized enrollees roughly doubled for 2026. If you’re shopping the Marketplace this year, the math is different than it was a year ago.
Here’s what’s actually available now.
2026 vs 2025
| 2025 (enhanced subsidies) | 2026 (pre-ARPA rules) | |
| Income cap for subsidies | None | 400% FPL |
| Required contribution at 150% FPL | 0% of income | 4% of income |
| Required contribution at 250% FPL | 4% of income | 8.05% of income |
| Required contribution at 400% FPL | 8.5% of income | 9.5% of income |
| Required contribution above 400% FPL | 8.5% of income | Unlimited (cliff) |
| Average subsidized premium payment | $888/year | ~$1,904/year |
| Projected uninsured increase | baseline | +2.2 million |
The subsidy cliff above 400% FPL hits older workers the hardest. A 60-year-old making $60,500 (barely above 400% FPL for a single person) can face a full-price premium of $900/month or more in some markets.
Who qualifies for subsidies
You qualify for a premium tax credit if your household income is between 100% and 400% of FPL for your family size, you’re not eligible for Medicaid or CHIP (which cover lower incomes), you’re not offered “affordable” employer coverage that meets “minimum value,” you’re a U.S. citizen or legally present, and you file a federal tax return.
For 2026, 400% FPL works out to roughly $62,600 for one person, $84,600 for two, $106,600 for three, $128,600 for four. A dollar over and your subsidy is zero.
Cost-sharing reductions
CSRs are separate from premium subsidies. They reduce deductibles, copays, and out-of-pocket maximums for people earning between 100% and 250% of FPL who pick a Silver plan. They’re automatic once you qualify.
At 150% FPL, a Silver plan with CSRs can have a deductible under $500 and an out-of-pocket max around $2,000. The same Silver plan without CSRs might have a $5,000 deductible and $9,200 out-of-pocket max.
If you’re under 250% FPL, always pick Silver during enrollment. Bronze is cheaper but you lose CSRs. At low incomes, Silver actually costs less total.
If you’re a retail or food service hourly worker with no employer coverage
You’re the core Marketplace audience. Apply at healthcare.gov or your state exchange.
Income under 138% FPL in Medicaid expansion states? You go to Medicaid, not the Marketplace.
Income 100-250% FPL? Silver plan with CSRs is almost always the right choice.
Income 250-400% FPL? Compare Silver and Bronze carefully. HSA-eligible Bronze plans pair well with a lower monthly premium if you’re healthy.
Open enrollment runs November 1 to January 15 for most states. Losing employer coverage triggers a 60-day Special Enrollment Period.
If your employer offers coverage
This is trickier. The “affordability test” decides whether you can get Marketplace subsidies even though you have an employer offer.
Your employer plan is “affordable” for you if the employee-only premium is under about 9.1% of household income. If it is, you can’t get subsidies for yourself through the Marketplace.
For your family, a separate test applies: if the family premium exceeds 9.1% of household income, your spouse and kids can get Marketplace subsidies even though your self-only employer plan is affordable. That family glitch fix (effective 2023) matters a lot for retail families where adding kids costs $600+ a month.
If you’re a gig worker or self-employed
Income estimation is the challenge. Marketplace subsidies are based on your projected annual income. Get it wrong and you either under-estimate (owe subsidy repayment at tax time, capped based on income) or over-estimate (miss out on subsidies you could have received, reconciled as a tax refund).
Use your last full Schedule C as a starting point. Update your estimate at healthcare.gov if income changes significantly mid-year. See tax and IRS issues for 1099 income and self-employment deductions.
If you were recently laid off
Losing employer coverage triggers a 60-day Special Enrollment Period. Usually cheaper than COBRA. If your income dropped because you lost the job, your subsidy will be larger than if you applied with your pre-layoff income.
Use your new, lower projected annual income when applying, not your old W-2 income. A laid-off retail worker with minimal income projected for the rest of the year might even hit the Medicaid threshold. Apply on healthcare.gov and the system screens both options.
If your kids are on CHIP
Adults in the household can get Marketplace coverage with subsidies while kids stay on free CHIP. This mixed setup saves money in nearly every case where the kids qualify for CHIP but the adults don’t qualify for Medicaid.
If you’re in your 60s and still working
You get hit hardest by the cliff. Premiums rise with age, and there’s no cap above 400% FPL anymore.
Close to 65? Consider a cheaper Bronze plan to bridge to Medicare.
Income fluctuates? Think about timing IRA distributions or Roth conversions to stay under 400% FPL for subsidy purposes.
Some states (California, New Jersey, Massachusetts, Washington) have state-funded subsidies that partially fill the federal gap. Check your state exchange.
Metal tiers
| Tier | Plan covers | You pay | Premium |
| Bronze | ~60% of costs | ~40% | Cheapest |
| Silver | ~70% (~94% with CSRs at low income) | ~30% | Moderate |
| Gold | ~80% | ~20% | Higher |
| Platinum | ~90% | ~10% | Highest |
Bronze has the lowest premium but highest deductible, often $6,000+. Silver with CSRs at 150% FPL actually covers 94% of costs and often has the lowest total out-of-pocket. Gold makes sense if you expect heavy healthcare use.
How to apply
Go to healthcare.gov or your state exchange (California, New York, Washington, Maryland, Massachusetts, Pennsylvania, Colorado, and others run their own).
Create an account and start an application.
Enter household size, income, and any existing coverage.
The system tells you what you qualify for: Medicaid, CHIP, or Marketplace subsidies.
Compare plans on price, deductible, network, and covered drugs.
Enroll. Pay your first premium to activate coverage.
Coverage starts the first of the month after enrollment, or January 1 if you enrolled during open enrollment by December 15.
Free help is available from certified Navigators at community organizations. Find one through healthcare.gov’s “Find Local Help” tool. They don’t sell insurance, so there’s no pressure to pick any particular plan.
When the Marketplace isn’t the right answer
If you qualify for Medicaid, go there instead. It’s free or close to free. If you have affordable employer coverage that meets minimum value, your subsidy would be $0. If you’re 65+, you belong on Medicare. If you’re a veteran with VA healthcare, you’re covered, though the Marketplace is still an option for dependents.
Short-term insurance vs the Marketplace
Short-term plans are cheaper but usually don’t cover pre-existing conditions, can deny you based on health history, don’t count as “minimum essential coverage” in some states, and often have lifetime coverage caps. If you’re healthy and under 30, one might bridge you for a few months. For anyone with a chronic condition or ongoing prescription, short-term plans are a trap. Stick with the Marketplace even if the premium stings.
Reconciling at tax time
If you received subsidies during the year and your actual income ended up different from your estimate, you reconcile at tax time on Form 8962. Actual income lower than estimate means additional subsidy as a refund. Actual income higher means you may owe back some subsidy (with caps at lower incomes but no cap at 400% FPL and above).
Update your Marketplace account within 30 days of any income change. It avoids surprises.
The current state of play
The expired subsidies hurt. Premiums roughly doubled for many enrollees in 2026. But the Marketplace still works for people under 400% FPL, and CSR-enhanced Silver plans are still often the best deal available in U.S. health insurance. Special Enrollment Periods still trigger for life events that derail employer coverage. The 2026 system is worse than 2025’s, and it’s still the best option most hourly workers have when there’s no affordable employer plan.