What Are Cost Sharing Reduction (CSR) in Health Insurance?
<lingo>A cost sharing reduction, or CSR, is a type of discount. It is often called an “extra savings” when it applies to the Health Insurance Marketplace. The discount may help to reduce the cost of deductibles, coinsurance, or copayments that you may have to pay for service. To obtain the savings, individuals must enroll in the proper plan through the Health Insurance Marketplace. These plans usually fall under the Silver category within the marketplace. It can be worth taking a closer look at these savings opportunities for some individuals.</lingo>
Cost Sharing Reduction (CSR) Briefly and Clearly Explained
The cost-sharing reduction is not available to everyone. To find out if you qualify for it, you will need to fill out an application through the Health Insurance Marketplace for coverage. When you do so, you will find out if you qualify for extra savings or any premium tax credits that may be available for you. Many people qualify for the tax credits – and when you do, they apply to any level of plan you select that is available to you. However, if you qualify for extra savings, they are only available through the Silver plans.
CSRs work to lower your out-of-pocket expenses. With them, you have a lower maximum amount you have to pay for out-of-pocket costs. This maximum is the total amount of covered medical services per year you have to pay for. Once you reach that level, the rest of your costs are then covered 100 percent. This level depends on the plan and coverage you choose.
<twitter>A cost sharing reduction, or CSR, is a type of discount. It is often called an “extra savings” when it applies to the Health Insurance Marketplace.</twitter>
Also note, if you fall in certain groups, you may qualify for additional cost-sharing reductions. For example, if you are a part of a federally recognized tribe or you are an Alaska Native Claims Settlement, you may be able to get a higher amount of reductions.
When choosing a health insurance plan from the Marketplace, it helps to consider this component as you compare your plan options. In many situations, you will be able to save significantly on out-of-pocket costs using the CSR.
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