How Covered California Subsidies Are Calculated in 2025

How Do Subsidies Work?

Covered California offers two types of financial help:

1. Premium Tax Credits: Lower your monthly premium
2. Cost Sharing Reductions (CSR): Lower your out-of-pocket costs

Your subsidy amount is based on your household income relative to the Federal Poverty Level (FPL).

Premium Tax Credits

Premium tax credits reduce your monthly insurance cost. Key points:

• Available from 100% of FPL with no upper income limit in 2025: the American Rescue Plan's enhanced subsidies (2021-2025) capped the benchmark Silver plan at 8.5% of income
• Based on the cost of the "benchmark" Silver plan in your area
• You can use the credit to buy any metal tier plan
• Credits are applied directly to your monthly premium

Cost Sharing Reductions

CSR benefits lower your deductibles and copays. You must choose a Silver plan to get CSR:

• Silver 73: Income 200-250% FPL
• Silver 87: Income 150-200% FPL
• Silver 94: Income up to 150% FPL

Income Calculation (MAGI)

Subsidies are based on Modified Adjusted Gross Income (MAGI), which includes:

• Wages and salary
• Self-employment income (net)
• Social Security benefits
• Retirement income
• Investment income

Certain deductions (retirement contributions, student loan interest) reduce MAGI.

Estimate Your Savings

Use our tools to estimate your subsidy: