CACs Premium Tax Credits and Cost-Sharing Reductions 2

Question 1

What is a Cost-Sharing Reduction (CSR)?

Accepted Answer

A subsidy that lowers out-of-pocket costs like deductibles and copays for eligible consumers

Answer

Cost-Sharing Reductions lower a consumer's out-of-pocket costs — such as deductibles, copays, and coinsurance — when they use health services.

Question 2

To receive Cost-Sharing Reductions, which type of Marketplace plan must a consumer enroll in?

Accepted Answer

A Silver plan only

Answer

CSRs are only available on Silver-tier Marketplace plans; consumers must choose a Silver plan to access this benefit.

Question 3

What household income level generally qualifies a consumer for Cost-Sharing Reductions?

Accepted Answer

Up to 250% of the Federal Poverty Level

Answer

CSRs are available to consumers with household income at or below 250% of the Federal Poverty Level who enroll in a Silver plan.

Question 4

How do CSRs affect the actuarial value of a Silver plan for eligible consumers?

Accepted Answer

They increase it, potentially making it equivalent to Gold or Platinum coverage

Answer

CSRs effectively increase the actuarial value of a Silver plan, meaning the plan pays a higher share of covered costs for eligible enrollees.

Question 5

A consumer is eligible for both APTC and CSR. What should a CAC advise regarding plan selection?

Accepted Answer

Enroll in a Silver plan to receive both premium savings and reduced cost-sharing

Answer

Enrolling in a Silver plan allows the consumer to receive both the premium reduction from APTC and the out-of-pocket savings from CSRs.

(CACs) Certified Application Counselor Practice Test