State RegulationsNY specificDifficulty 3/5
A Manhattan agent is explaining exchange subsidies to a client. Which statement about cost-sharing reductions under the Affordable Care Act is correct?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under the Affordable Care Act, cost-sharing reductions are tied to silver-level plans: an eligible enrollee who buys a silver plan receives a version with reduced deductibles, copayments, and coinsurance. They are not loans, they do not lower the premium (that is the premium tax credit's role), and they are not available at the other metal levels. Choosing bronze or gold instead would forfeit this particular assistance.
Why the other options are wrong
- A) Cost-sharing reductions are not offered at every metal level; they are linked to silver plans.
- B) The deductible is exactly what they reduce; the monthly premium is untouched by this subsidy.
- C) No repayment is involved; cost-sharing reductions are not loans, unlike advance premium tax credits that are reconciled at tax time.
Memory hook
Silver is the only metal that wears the cost-sharing reduction.