2018 ACA Affordability Percentage
The 2018 ACA Affordability Percentage is 9.56%.
Effective 2018-01-01Source: Rev. Proc. 2017-36 (IRS)Verified 2026-08-30
Required contribution percentageSource: Publication 974 (2018), Premium Tax Credit (PTC) (IRS)Verified 2026-08-30
Compared with 2017
| Item | 2017 | 2018 | Change |
|---|---|---|---|
| Required contribution percentage | 9.69% | 9.56% | -0.13% (-1.3%) |
Who it applies to
Individuals determining whether employer-sponsored minimum essential coverage is affordable under Internal Revenue Code § 36B
What changed this year, and why
The IRS set the ACA required contribution percentage at 9.56% for plan years beginning after December 31, 2017.
Common questions
- What is the ACA affordability percentage for 2018?
- The required contribution percentage for 2018 is 9.56%. This percentage is used to determine whether employer-sponsored health coverage is considered affordable for purposes of the premium tax credit under § 36B.
- When does the 9.56% rate take effect?
- It applies to plan years beginning after December 31, 2017.
Every amount on this page is a published figure rather than yours. The Affordable employer coverage calculator takes the number you enter and works it out against them, showing which published figure it used.
The share of household income that makes an offer affordable
For 2018, an employer's health plan is affordable if the employee's share of the annual premium for self-only coverage - called the employee required contribution - is no more than 9.56% of the tax family's household income. This self-only test applies even when the employee would actually enroll in family coverage covering a spouse or dependents. If the required contribution exceeds the 9.56% threshold, the offer is unaffordable and the employee (and potentially the tax family) may qualify for the premium tax credit on a qualified health plan. If the contribution is at or below 9.56%, the offer is treated as affordable and blocks the credit.
How to determine if the plan is affordable. Your em- ployer coverage generally is considered affordable for you and for a family member if your share of the annual cost for self-only coverage, which is sometimes referred to as the employee required contribution, is not more than 9.56% of your tax family’s household income for 2018.
Publication 974 (2018), Premium Tax Credit (PTC) (IRS)
An affordable offer blocks the premium tax credit
Even when an employer offers coverage that qualifies as minimum essential coverage, the offer only blocks the premium tax credit if it also passes two additional tests: the coverage must be affordable and it must provide minimum value. If either test fails, the employee is not treated as eligible for an employer-sponsored plan and may receive the credit. The same two tests apply to tax family members offered coverage through the employee's employer. However, if an employee or family member actually enrolls in the employer's minimum essential coverage, that enrolled person cannot get the premium tax credit even if the coverage is unaffordable or fails to provide minimum value.
Affordability and minimum value. Even if you had the opportunity to enroll in coverage offered by your em- ployer that qualifies as MEC, you are considered eligible for an employer-sponsored plan (and cannot get the PTC for your coverage in a qualified health plan) only if the em- ployer-sponsored coverage is affordable (defined later) and the coverage provides minimum value (defined later).
Publication 974 (2018), Premium Tax Credit (PTC) (IRS)
The second test an employer plan has to fail
An employer-sponsored plan provides minimum value only if the plan pays at least 60% of the total allowed costs of benefits for a standard population and provides substantial coverage of inpatient hospitalization services and physician services. A plan meets the 60% rule only if an employee's expected cost-sharing - deductibles, co-pays, and co-insurance - under the plan is no more than 40% of the cost of the benefits. This percentage is based on actuarial principles using benefits provided to a standard population and is not based on what the employee actually pays for cost sharing.
An employer-sponsored plan provides minimum value only if the plan pays at least 60% of the total allowed costs of benefits for a standard population and provides sub- stantial coverage of inpatient hospitalization services and physician services. A plan meets the 60% rule only if an employee’s expected cost-sharing (deductibles, co-pays, and co-insurance) under the plan is no more than 40% of the cost of the benefits.
Publication 974 (2018), Premium Tax Credit (PTC) (IRS)
A waiting period is not coverage you can use
A waiting period before employer coverage becomes effective is not treated as a month when the employee is eligible for employer coverage. During that month, the employee may receive the premium tax credit on a qualified health plan if otherwise eligible. However, if the employee could have enrolled in employer coverage that is minimum essential coverage, affordable, and provides minimum value, but did not enroll during the enrollment period, the employee cannot get the premium tax credit for the remainder of the plan year to which that enrollment period related.
Waiting periods and other periods without access to benefits. You are not considered eligible for employer coverage, and can get the PTC for your coverage in a qualified health plan if you are otherwise eligible, for a month when you cannot receive benefits under the em- ployer coverage (for example, you are in a waiting period before the employer coverage becomes effective).
Publication 974 (2018), Premium Tax Credit (PTC) (IRS)
Which plans are eligible employer-sponsored coverage
An eligible employer-sponsored plan is an employer-sponsored plan that also qualifies as minimum essential coverage. The category includes several kinds of employer arrangements: a group health plan or health insurance coverage offered by an employer in the small or large group market, a self-insured group health plan for employees, certain expatriate health plans for employees, and the Nonappropriated Fund Health Benefits Program of the Department of Defense. These plans may also include retiree or COBRA coverage. Employer-sponsored health coverage limited to excepted benefits - such as stand-alone vision or dental, workers' compensation, or disease-specific coverage - is not minimum essential coverage and therefore is not an eligible employer-sponsored plan.
Employer-sponsored plans that are MEC also are refer- red to as eligible employer-sponsored plans.
Publication 974 (2018), Premium Tax Credit (PTC) (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Publication 974 (2018), Premium Tax Credit (PTC) (IRS)
- Required contribution percentage
Your employer coverage is not considered affordable, if, when you enroll in a qualified health plan, the MarketplaceCAUTION ! determines that your required contribution for employer coverage will be more than 9.56% of what the Market- place estimates will be your household income and there- fore that you are eligible for APTC for coverage in the qualified health plan.