What does a subsidy in health insurance refer to?

A subsidy in health insurance refers to a sum of money provided by the government to help lower the cost of health insurance premiums and make them more affordable for individuals and families. Subsidies are designed to ensure that people have access to necessary medical care without facing financial hardship. This assistance can come in various forms, such as premium tax credits that reduce the monthly premium payments for eligible individuals based on their income level and family size.

This mechanism is part of broader healthcare policies aimed at increasing coverage rates and lowering the overall cost burden on consumers. By providing financial support, subsidies help to bridge the gap for those who might otherwise be unable to afford insurance, thus improving access to healthcare services for a larger segment of the population.