The Health Coverage Tax Credit is a 2002 law passed by the U.S. Congress to help American workers whose health care status has been affected by trade. That is, the law helps those Americans whose jobs have been affected by free trade, globalism and outsourcing of jobs. U.S. lawmakers passed the Health Coverage Tax Credit Law or HCTC Law because they believed losing one’s health insurance could be as traumatic as losing one’s job, so they passed a law that would help certain Americans pay for their health insurance, thereby assuring that even more U.S. citizens do not join the ranks of the uninsured.
This health coverage tax credit went into effect in August of 2003 on a monthly basis, while it had been made available for Tax Year 2002 a few months earlier (specifically April 15, 2003, when people paid their 2002 taxes). The law gives a tax credit to certain workers whose jobs and health care needs were affected by the closing of factories due to international trade. This was done by giving a tax credit to compensate these people for the much larger amounts of money they paid for health insurance after losing their jobs. These days, someone can get the HCTC tax credit on a monthly or yearly basis, and several federal and state agencies (including HPAs or Health Plan Administrators) work together to assure timely payment.
Who Does The Health Coverage Tax Credit Apply To?
There are two major groups from whom the Health Coverage Tax Credit applies to. The first group includes retirees over 55 whose pensions are now administered by the Pension Benefit Guaranty Corporation. The PBGC was created in 1974 to make certain of the continuation and maintenance of private pensions plans.
A third group affected by the Health Coverage Tax Credit includes the family members of retirees under the Pension Benefit Guaranty Corporation and the family members of those who have lost their jobs to trade and qualify for the Health Coverage Tax Credit.
How Much Does HCTC Cover?
The HCTC covers 65% of a person’s health care costs. Therefore, if you worked for a corporation which had a standard group insurance plan which was affordably-priced, and you lost your job from this corporation due to trade, you will likely pay a much higher insurance premium if you buy your health insurance as a single payer. Due to the Health Coverage Credit Law, the U.S. government will pay 65% of this larger medical insurance premium which you must pay for. While this may or may not totally offset the new costs you take on for health insurance, it does help to allay most of said health insurance premium costs.