How Can I Find Out If I Qualify for Discounted Health Insurance?

The signed Affordable Care Act (Photo credit: Chuck Kennedy via Wikipedia Commons)This weekly Q&A addresses questions from real patients about healthcare costs. Have a question you'd like to see answered? Submit it to AskChristina@nerdwallet.com.Question:

I've heard about premium tax credits, subsidies and other ways the Affordable Care Act is supposed to make health insurance more attainable, but I don't know how to take advantage of these things. How can I find out if I qualify for this assistance without having to sign up?

Answer:

The purpose of the Affordable Care Act is evident in its name: to provide affordable health care to all Americans. This includes, as you mentioned, tools designed to make health insurance more attainable for those who may otherwise struggle to pay for their health care. But understanding how to use these tools can be tricky. The first step is learning how they work.

Know the difference between premium tax credits and cost-sharing subsidies

Premium tax credits are designed to reduce the amount of your monthly health insurance premium, that is, the amount you'll pay for your health insurance plan. The ACA set limits on how much people should have to pay for health insurance premiums; they are capped at no more than 9.56% of your income for 2015. These credits help pick up the difference.