Important Message: To get health insurance, you must sign up during an enrollment period. Vermont Health Connect has a Special Enrollment Period open now through May 15, and uninsured Vermonters can enroll in a qualified health plan during this time. Under the American Rescue Plan Act, Vermonters can get more financial help when they enroll through Vermont Health Connect. Vermonters who have insurance directly through Blue Cross and Blue Shield of Vermont or MVP Health Care® can transfer their plan to Vermont Health Connect now to get premium tax credits. Vermonters who are eligible for Medicaid can enroll at any time.
Advance Premium Tax Credits
If you enroll in a Vermont Health Connect qualified health plan (QHP) you may be eligible for financial help—including the premium tax credit (PTC). You may get PTC if your income is below 400% of the Federal Poverty Level (FPL) and you meet other eligibility rules. You must file federal taxes to get premium tax credits.
If you’re eligible for premium tax credits, you can choose to take them:
- In advance, so you pay less each month for your health insurance premium; or
- At the end of the year when you file taxes; or
- Part in advance, and part at the end of the year when you file taxes.
Many Vermonters take premium tax credits in advance to lower monthly health insurance premiums. When you take the tax credit in advance it’s called “advance premium tax credits,” or APTC. The amount of APTC you will get is based on your projected income for the year. Once you choose how much of your APTC you want to use, it comes out of your health insurance premium automatically. For example, if your total insurance premium is $500 per month and you choose to use $400 per month of the APTC amount you are eligible for, your monthly bill is $100 per month ($500-$400=$100.)
IMPORTANT: The amount of APTC you can use may change if your income or your tax household size changes. Read on to learn more.
What Happens if You Get Too Much APTC?
If you take your premium tax credits in advance as APTC, your APTC amount is based on what you report to VHC about your estimated income for the calendar year, and who is in your tax household. When you file federal taxes at the end of the year, the IRS will look at the amount of APTC you got during the year and compare it to the income you report on your federal taxes. If you got too much APTC during the year, you may have to pay some of it back. That's why it's important to give VHC an accurate estimate of your income.
If you didn’t take your full amount of APTC, you will get the rest of your premium tax credits when you file federal taxes.
Estimating income isn’t always easy—especially for Vermonters who are self-employed or have more than one job. Here are some tips to help you avoid owing premium tax credits back at tax time:
- Estimate your income a little high (this means you will get less APTC each month.)
- Report any changes of income or tax household members to Vermont Health Connect right away. Call our Customer Service Center at 1-855-899-9600 or login to your online account.
- Choose to take some of your tax credits in advance, and some at the end of the year.
It’s important to report any changes to Vermont Health Connect right away so you get the right amount of APTC during the year. For example, if you get APTC and report a change of income to Vermont Health Connect during the year, the amount of APTC you can get may change. This can sometimes result in something called “APTC exhaustion.” APTC exhaustion happens when your income goes up and your yearly APTC amount goes down. The amount of APTC you’ve used so far is subtracted from your adjusted yearly APTC amount. APTC exhaustion will help you avoid owing premium tax credits back when you file taxes, but it also means your monthly premium bill will be higher because you're getting less financial help. To see examples of how APTC exhaustion works, check out our APTC exhaustion page.
Eligibility for Tax Credits
To get financial help, you must apply for coverage during an enrollment period: