The 400% FPL Subsidy Cliff: What It Means for Your Premium
See if your household qualifies for a lower premium
Free review with a licensed Texas agent based in Katy. We'll tell you honestly if the ACA is still your best fit.
What is the subsidy cliff?
The premium tax credit is based on your expected household income (MAGI) as a percentage of the federal poverty level. Below 400% FPL you may receive help; above it, the help generally drops to zero — there is no gradual phase-out. That sudden drop is the cliff.
From 2021 through 2025, temporary enhanced subsidies removed the cap. For 2026 coverage, the 400% limit is back.
| Household size | 100% FPL | 400% FPL (cliff) |
|---|---|---|
| 1 | $15,650 | $62,600 |
| 2 | $21,150 | $84,600 |
| 3 | $26,650 | $106,600 |
| 4 | $32,150 | $128,600 |
| 5 | $37,650 | $150,600 |
| 6 | $43,150 | $172,600 |
Estimate your 2027 subsidy
Enter your household details to see your expected contribution and estimated premium tax credit under the official 2027 rules (IRS Rev. Proc. 2026-26). Estimate only — the Marketplace makes the final call.
Want an exact number? Call 281-747-9800 or book a free call and a licensed Texas agent will run your real quote.
Estimate only. Uses the 2026 HHS poverty guidelines and the official 2027 applicable percentage table (IRS Rev. Proc. 2026-26). Benchmark premium is a Texas estimate by age unless you enter your own. Final eligibility and amounts are determined by the Marketplace using verified MAGI.
Ways people near the cliff review their options
Before you assume you're stuck, a licensed agent can review:
- Whether your income estimate is accurate — retirement contributions and HSA deposits can lower MAGI (ask your tax professional)
- Whether healthy household members qualify for an underwritten alternative
- Whether family members with health needs should stay on an ACA plan on their own
- Bronze or HSA-eligible Marketplace plans as a lower-premium ACA option
Compare your current ACA premium — free
Free review with a licensed Texas agent based in Katy. We'll tell you honestly if the ACA is still your best fit.
If you have health issues
If you have a significant medical history — such as cancer, diabetes, heart disease, a recent hospitalization, pregnancy, ongoing treatment or a pending procedure — you will likely need an ACA Marketplace plan (also called Obamacare). Alternative products are generally not for people with health issues or for lower-income households who qualify for strong ACA subsidies.
Talk to a licensed agent
A licensed agent can compare your current ACA premium against options you may qualify for — and will tell you plainly if the Marketplace is still the right fit.
Frequently asked questions
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Related guides
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Free review with a licensed Texas agent based in Katy. We'll tell you honestly if the ACA is still your best fit.
*Some ACA plans in some areas have a small one-time enrollment fee due to little or no broker compensation. Agency enrollment fees never apply to Medicare products.
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