Inflation Reduction Act Boosts Obamacare Tax Credit

Despite its name, the Inflation Reduction Act's main goals are really to address climate change and lower healthcare costs. One of the ways healthcare costs are reduced is by extending enhancements to the premium tax credit that were put in place for 2021 and 2022. Now that President Biden has signed the bill into law, not only will more people qualify for the premium tax credit for three more years, but many of them will also get a larger credit during that time.

Premium Tax Credit Eligibility Expanded

The premium tax credit was originally enacted as part or a state exchange). By subsidizing the cost of health insurance with the credit, more people can afford insurance and get it at a lower price. And, with advance payments of the credit directly to the insurer, consumers have less out-of-pocket costs.