Buying Coverage on the ACA Marketplace

If you are self-employed, between jobs, retiring before 65, or working somewhere that offers no affordable coverage, the Affordable Care Act Marketplace is where you buy health insurance, and the price you pay depends less on the plan than on the income you report. The rules changed for 2026: the extra help available since 2021 has ended, so a small difference in income can now mean a large difference in premium. This chapter explains who qualifies for help, how the premium tax credit is sized, the income levers that are legitimately in your control, cost-sharing reductions, and the windows for signing up.

Who the Marketplace is for

Anyone living in the US who is not in prison and meets the immigration rules can buy a Marketplace plan. The question is whether you get financial help, and two things can rule that out.

An affordable employer offer. If you can enroll in employer coverage that meets a minimum value standard and your share of the self-only premium is no more than 9.96% of household income in 2026, you cannot get the credit, even if you prefer a Marketplace plan. Since 2023, family members are judged on the cost of family coverage, not the employee's self-only cost, which lets many spouses and children qualify when family coverage through work is expensive.

Medicare or Medicaid eligibility. People eligible for premium-free Medicare Part A, and in most states adults with income below 138% of the poverty line in states that expanded Medicaid, are generally directed to those programs instead.

How the premium tax credit is sized

The credit is built around a benchmark: the second-lowest-cost silver plan available to you. The law sets how much of your income you are expected to pay for that benchmark, and the credit covers the rest.

Credit = benchmark premium − (your applicable percentage × household income), never more than the premium of the plan you pick.

For 2026 coverage, the applicable percentage rises with income from 2.1% at the lowest incomes to 9.96% from 300% of the poverty line. Income is measured against the federal poverty guideline from the year before coverage: for 2026 coverage in the 48 contiguous states, $15,650 for one person plus $5,500 for each additional person.

You can apply the credit you choose to any metal level. Because the credit is a fixed dollar amount set by the silver benchmark, a cheaper bronze plan can cost very little after the credit, while a gold plan costs the full difference above the benchmark.

The cliff is back for 2026

From 2021 through 2025, a temporary law removed the income cap and limited everyone's expected payment to a modest share of income. That enhancement expired on December 31, 2025. For 2026 the credit again stops completely once household income passes 400% of the poverty line: $62,600 for a household of one and $84,600 for a household of two in the contiguous states. One dollar over the line removes the whole credit.

Congress has debated restoring the enhancement; the House passed an extension in January 2026, but as of late September 2026 none had been enacted. Check HealthCare.gov for the rules in force when you enroll.

Two other 2026 changes matter. If you take the credit in advance and your actual income turns out higher, you must now repay the full excess when you file, with no cap. And the credit is reconciled on Form 8962 with your tax return, so the income estimate you give the Marketplace in the fall is effectively a promise you settle in April.

Income you control: lowering MAGI legitimately

The income the Marketplace uses is modified adjusted gross income (MAGI): adjusted gross income plus tax-exempt interest, untaxed Social Security benefits and excluded foreign income. Because it is adjusted gross income, money that leaves your income before AGI also lowers it. The common levers are contributions to a traditional 401(k), 403(b) or deductible IRA; a self-employed retirement plan; and HSA contributions. From 2026, every bronze and catastrophic plan sold on the Marketplace counts as HSA-compatible, so a bronze buyer can now pair the plan with an HSA.

Here is how that plays out for a single person whose income comes from a job with no health benefits.

At $66,000, income is above the $62,600 line, so there is no premium tax credit for the year, and federal income tax is $5,740. Contributing the self-only HSA limit of $4,400 brings income to $61,600, below the line. Federal tax falls to $5,212, and the household becomes eligible for a credit again. Its size depends on the local benchmark premium, which rises with age and varies by county; for an older buyer in a high-cost area it can be many times the tax saving. The ACA subsidy calculator computes the credit for your income, age and household.

For early retirees, the same logic shapes which accounts to draw from. Withdrawals from a traditional IRA or 401(k) count as income; spending cash or Roth IRA contributions do not; selling investments counts only the gain. Planning a retirement income at a level that keeps you under the cliff can be worth more than any investment decision that year.

Cost-sharing reductions: why silver can beat bronze

Households with income from 100% to 250% of the poverty line who choose a silver plan also get cost-sharing reductions: a lower deductible, lower copays and a lower out-of-pocket maximum, at no extra premium. The plan's actuarial value rises from about 70% to 73%, 87% or 94%, depending on income, which can make a silver plan behave like a gold or even platinum plan. Cost-sharing reductions only come with silver, so at these incomes it is usually worth comparing silver carefully before taking the cheapest bronze.

When you can sign up

Open enrollment. The yearly window on HealthCare.gov starts November 1. Its end date was shortened by a 2025 federal rule from the 2027 plan year, and state-run marketplaces set their own, so check the closing date for your state each year. Coverage chosen by mid-December usually starts January 1.

Special enrollment periods. Outside open enrollment you can sign up within 60 days of a qualifying event, such as losing other coverage, moving to a new area, marriage, or a birth or adoption. Losing job-based coverage qualifies; the 60 days generally run from the day coverage ends, and you can report the loss up to 60 days in advance.

COBRA. When you leave a job at an employer with 20 or more employees, you can usually keep the same plan for 18 months, but you pay the full premium plus up to 2% for administration. You have 60 days to elect it, and coverage is retroactive, so you can wait to see whether you need care. Compare it with a Marketplace plan before deciding: the Marketplace credit cannot be used for COBRA, and dropping COBRA voluntarily outside open enrollment does not open a special enrollment period, though COBRA running out does.