MIAMI, FL - FEBRUARY 21: Dr. Martha Perez examines Maria Lebron in a room at the Community Health of South Florida, Doris Ison Health Center on February 21, 2013 in Miami, Florida. Florida Governor Rick Scott reversed himself on Wednesday and now is callling for an expansion of Medicaid to Florida residents under the federal Affordable Care Act. (Photo by Joe Raedle/Getty Images)
Joe Raedle/Getty Images
By Tami Luhby

Nearly 26 million Americans could be eligible for health insurance subsidies next year, but most don't know it.

That's because relatively few people are familiar with provisions in the Affordable Care Act, aka "Obamacare," that will provide tax credits to low- and middle-income consumers to help them purchase health coverage through state-run insurance exchanges.

Most of those who will be able to claim the subsidies are in working families with annual earnings between $47,100 and $94,200, according to a recent analysis by Families USA, a consumer advocacy group. More than a third of those eligible will be young adults between ages 18 and 34.

"There's a huge number of people who can get coverage this way and can get significant help," said Ron Pollack, executive director of Families USA. "It's not just for the poor. It reaches deeply into the middle class."

Here's how the subsidies will work:

Starting in October, those looking to buy individual health insurance can enroll in plans offered through state-based exchanges, with coverage beginning in January. Consumers buying individual plans will be able to choose between four levels of coverage: platinum, gold, silver and bronze. The plans will differ in their premiums and out-of-pocket expense burdens.

People who are not in a government health insurance program, such as Medicaid or Medicare, and do not have access to an affordable plan at work may be eligible for help paying their premiums. The assistance is available to those with incomes of up to four times the federal poverty level -- this year, that's $45,960 for an individual or $94,200 for a family of four -- and will be scaled to ensure that folks don't pay more than a designated percentage (the exact target varies by income level) of their earnings toward the premium. The subsidy will be paid directly to the insurance company.

Related: 6 companies cashing in on Obamacare

The federal subsidies will be pegged to the cost of a "silver" plan, which will vary depending on where consumers live. Insurers will soon submit to the states and federal government details of the plans they'll offer in the exchanges, including the premium costs, but consumers may not learn the specifics until open enrollment starts in October.

Families USA crunched the numbers for a few different scenarios. By its estimates, a family of four earning $94,200 and purchasing a silver-level plan carrying a $12,500 annual premium will get a subsidy worth $3,550, which limits the cost of the premium to 9.5% of the family's income.

The government hasn't yet released its own estimates on how many Americans will be eligible for the subsidies, but Families USA believes that up to 26 million citizens will meet the criteria.

Not everyone eligible for those subsidies will actually sign up, though. The Congressional Budget Office is forecasting that only 6 million people will receive subsidized coverage through an exchange next year. It expects that number to grow to 22 million by 2017.

Many Americans are still in the dark about Obamacare provisions that could help them, said Matthew Buettgens, senior research analyst at the Urban Institute.

"Outreach is going to be crucial to creating viable exchanges in the early years," he said.

It will be a heavy lift. Only 62% of Americans are aware that subsidy assistance is available to individuals under the health reform law, according to a March Kaiser Family Foundation poll. And about two-thirds of the uninsured say they don't understand how Obamacare will affect them.

All Americans are required to carry health insurance as Jan. 1, 2014, or face financial penalties, but if enrolling in coverage through the state exchanges is too expensive or too confusing, uninsured individuals might choose to skip it and pay the fines instead. That could lead to fewer healthy people enrolling -- which would make coverage in the exchanges more costly for everyone, since they would become populated primarily by people with greater medical needs.

"You want a broad range of people to enroll," Buettgens said.

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More handouts is not the answer. Obamacare will kill me. And no sunsidies will
stop it from doing so because it is designed to take from one and give to the other.

April 25 2013 at 2:48 AM Report abuse +1 rate up rate down Reply

we have Medicare Advantage and of course will no longer get that.More will be taken from Social Security to pay for Part B,but we do not know what we will be getting in addition to that.Can't go to our neighborhood insurance guy of course.If you are elderly and not computer literate it will be very difficult for them to pick out something.Oh that is right, there are Obamacare Navigators being paid REALLY well to tell you what to get.Don't think I trust them or anyone in Govt that has anything to do with this.They will be taking all of your private and financial information.I have the best insurance right now that I have had in the last 25 years,since last August,Medicare Advantage,and now will have to kiss it goodbye , along with great healthcare.

April 25 2013 at 2:00 AM Report abuse rate up rate down Reply

regardless, the subsidies are paid for by the taxpayer.So not only will people be paying for their own, they will be paying for others too.Government taking from some to give to others while screwing everyone

April 25 2013 at 1:55 AM Report abuse +1 rate up rate down Reply
John Lewis

Single white middle-aged male with no family.

Want to bet that there's no subsidy anywhere in that mess for someone like me?

April 24 2013 at 11:37 PM Report abuse rate up rate down Reply
1 reply to John Lewis's comment


April 25 2013 at 1:11 AM Report abuse -2 rate up rate down Reply

Do some large companies/industries get or have gotten subsides? yes they have.

April 24 2013 at 11:04 PM Report abuse +2 rate up rate down Reply

Line up little government slaves. You will be handed out gifts like a bunch of little beggars.

April 24 2013 at 10:55 PM Report abuse +1 rate up rate down Reply
1 reply to alscottinc's comment


April 25 2013 at 1:12 AM Report abuse -2 rate up rate down Reply

If you are making $94,000 you should be able to afford to pay premiums for insurance and the $3,500 is a drop in the bucket for them. What about someone like myself, I have medicare and also pay for an insurance plan from my former employer. My income is about $25,000, what will people like me get in subsidies. Should I bend over now or wait a few months?

April 24 2013 at 9:38 PM Report abuse +1 rate up rate down Reply
1 reply to Kay's comment

REally a drop in the bucket? 94,000 for a family of 4 maybe putting a kid through college funny how so many people think that everyone making more then them can afford something. What is really sad is someone just over the limit to get medicaid is expected to pay $25.00 a month which honestly someone just over that threshold for medicaid probably struggles to put food on the table and that $25.00 doesn't exist at the end of the month.

April 24 2013 at 10:36 PM Report abuse +3 rate up rate down Reply
1 reply to dxl504's comment

94,000 for a family of four still qualifies for some subsidy under the ACA. That's if they don't already have employer based healthcare plans. Which most do.

April 25 2013 at 12:12 AM Report abuse rate up rate down

I am on Medicare, so I doubt O'Bamacare will do me any good. Will probably hurt me.

April 24 2013 at 9:35 PM Report abuse +1 rate up rate down Reply
1 reply to Jorge's comment


April 25 2013 at 1:13 AM Report abuse -1 rate up rate down Reply

It will take a lawyer to tell us what we are able to do and not do under Obamacare, so who can
afford that? Someone will have to foot the bill to understand what the benefits will be for the wages we make, Currently part B of medicare costs 145.00 per month, and the part D for meds costs over 76.00 per month plus what is taken out of your social security it is over 300.00 per month for coverage. I do not think Obamacare can do any better. Where is it a given that we all can have FREE medical care?

April 24 2013 at 9:15 PM Report abuse +1 rate up rate down Reply

Your welcome because these subsidies are coming at an increased cost in my premiums of, to date, 150 a month. So for this family of modest income, they now will only have to pay $750 a month for mandated health insurance premiums. There was no talk of deductibles, so i guess the author assumes there is no further out of pocket expense for health care. This may not be true. Plus no one factored in the increase cost in fees and taxes on other health related products. Stop the one sided look at what is a very costly plan that the average person cannot afford but is mandated by law to participate. Shameful.

April 24 2013 at 8:28 PM Report abuse rate up rate down Reply
1 reply to anthdif's comment

article states carrying an annual deductible of $12,500.00

April 24 2013 at 10:16 PM Report abuse +1 rate up rate down Reply