Q: I live in Boston, where health care is really expensive. Are the subsidies large enough to make insurance affordable here?
A: Yes, the size of the ACA premium subsidy varies depending on where you live. If medical care is extremely pricey in your area, the subsidy rises to keep up with premiums.
The concept behind the subsidies is to even out the cost of premiums and make it so two people with the same income will pay the same amount for the second-lowest-cost plan, regardless of where they live, how old they are, or how healthy they are. So assuming they both have the same income, a younger person will get a smaller subsidy than an older person. That’s because the pre-subsidy premium for the younger person is going to be lower to begin with. And someone living in an area where health insurance premiums are higher than average is going to get a larger subsidy than a person in an area where premiums are low.