Cost-Sharing Reduction
An ACA subsidy that lowers deductibles, copays, and out-of-pocket maximums for eligible lower-income Silver plan enrollees.
What is CSR?
A cost-sharing reduction (CSR) is a subsidy available under the Affordable Care Act that reduces the out-of-pocket costs — including deductibles, copayments, and coinsurance — for eligible individuals and families with incomes between 100% and 250% of the federal poverty level (FPL) who enroll in a Silver-tier health plan through the ACA marketplace. CSRs effectively enhance the actuarial value of a Silver plan: eligible enrollees at 100–150% FPL receive a Silver plan that functions more like a Platinum plan (AV ~94%), while those at 200–250% FPL receive enhanced Silver coverage with AV ~73%. To receive CSRs, enrollees must choose a Silver plan — CSRs are not available on Bronze, Gold, or Platinum plans. The subsidies are applied automatically by the insurer; enrollees do not pay or file separately for them.
Example
A family of four with income at 175% of the federal poverty level (~$54,000 in 2024) enrolls in a Silver plan on Healthcare.gov. They qualify for both a premium tax credit and a CSR. Their Silver plan functions with an ~87% actuarial value: their deductible might be $500 instead of $5,000, and their out-of-pocket maximum might be $3,000 instead of $9,450.