Question: My company gives employees a certain amount each month for coverage instead of providing health insurance. Ami I still eligible for a subsidy?
Answer: Yes. Some employers offer a cash “stipend” instead of offering health insurance. This cash stipend is taxable income, similar to a bonus or a pay raise, and cannot be conditioned on the purchase of health insurance. If the employee uses the stipend to purchase a marketplace plan, the payments will be made on an after-tax basis and will not be made through payroll deductions. This type of employer assistance does not disqualify a person from receiving premium tax credits. Employers cannot reimburse employees for the cost of their marketplace premiums using pre-tax dollars.