HR Fast Facts: What Is Affordable Coverage for Health Insurance?
Affordable coverage under the ACA means that an employee’s required contribution for self-only coverage doesn’t surpass a certain percentage of their household income.
Affordable coverage under the Affordable Care Act means that the employee’s required contribution for self-only coverage (meaning the amount to acquire coverage for only oneself, and not the cost for dependents) does not exceed a certain percentage of their household income.
| Plan Year Beginning | Affordability Percentage |
| 2019 | 9.86% |
| 2020 | 9.78% |
| 2021 | 9.83% |
| 2022 | 9.61% |
Safe harbors
Because most employers won’t have access to their employees’ actual household incomes, the Internal Revenue Services provides 3 “safe harbor” methods that can be used to estimate income using information that employers do have.
