Vicki Fung, Catherine Y Liang, Karen Donelan, Cassandra G K Peitzman, William H Dow, Alan M Zaslavsky, Bruce Fireman, Stephen F Derose, Michael E Chernew, Joseph P Newhouse, John Hsu

The Affordable Care Act includes financial assistance that reduces both premiums and cost-sharing amounts for lower-income Americans, to increase the affordability of health insurance coverage and care. To receive both types of assistance, enrollees must purchase a qualified health plan through a public insurance exchange, and those eligible for the cost-sharing reduction must purchase a silver-tier plan. We estimate that 31 percent of individual-market enrollees in California who were likely eligible for financial assistance purchased plans that were not silver tier or that were not sold on the state's exchange and thus missed opportunities to receive premium or cost-sharing assistance or both. Lower-income enrollees who chose plans not eligible for subsidies had two to three times higher odds of reporting difficulty paying premiums and out-of-pocket expenses during the year, compared to those who chose eligible plans. Regardless of how the structure of the individual market evolves in the coming years, efforts are likely needed to steer lower-income enrollees away from financially suboptimal plan choices.