Cost-Sharing Reduction — CSR
A Cost-Sharing Reduction lowers the deductible, copays, and coinsurance on a Silver ACA Marketplace plan for people with lower income.
Official source: healthcare.gov
Cost-sharing reductions are like a special discount that makes your health insurance cheaper to use. If you have a health insurance plan from the Affordable Care Act (ACA) marketplace, and your income is not very high, you might qualify for this discount. It helps you pay less when you go to the doctor, get prescriptions, or have a hospital stay. This is different from a premium tax credit, which helps you pay for the monthly cost of your insurance.
Here's how it works: these reductions are only for plans in the "Silver" category on the marketplace. If you pick a Silver plan and you qualify based on your income, the government helps pay for parts of your medical bills. This means your deductible, which is what you pay before insurance starts helping, will be lower. Your copayments, which are the small fees you pay for a doctor visit or medicine, will also be less. And your coinsurance, which is a percentage of the cost you pay, will be smaller too.
In real life, this means if you have a medical emergency or need ongoing care, you won't have to worry as much about the immediate costs at the doctor's office or pharmacy. For example, if your plan usually has a $1,000 deductible, with a cost-sharing reduction, it might only be $250. This can make a big difference in how affordable healthcare feels, especially if you have an unexpected illness or injury.
In real life
- A worker earning under 250% of poverty pays a smaller deductible because of CSR.
- Maria's doctor visits cost less because her income qualifies her for a Cost-Sharing Reduction on her health plan.
- David's family pays much less out of pocket for their prescriptions thanks to the Cost-Sharing Reduction attached to their silver plan.
Also known as
Take the next step
Frequently asked questions about Cost-Sharing Reduction
What is Cost-Sharing Reduction?+
A Cost-Sharing Reduction lowers the deductible, copays, and coinsurance on a Silver ACA Marketplace plan for people with lower income.
Who qualifies for Cost-Sharing Reduction?+
Anyone without affordable job-based coverage, Medicaid, or Medicare can shop the Marketplace. Subsidies depend on household income.
How do I apply for Cost-Sharing Reduction?+
Apply during Open Enrollment (Nov–Jan) or after a qualifying life event at healthcare.gov, or through your state's Marketplace. Official forms and instructions: https://www.healthcare.gov/lower-costs/save-on-out-of-pocket-costs/.
Where can I get help?+
Compare plans and check subsidies at healthcare.gov, or call a free local Navigator listed there. BenefitKarma's free Benefit Eligibility Screener can also tell you if you qualify for Medicaid instead.
Source: healthcare.gov