FROM THE OFFICE OF PUBLIC AFFAIRS

January 26, 2005
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Snow Applauds New States Offering Health Coverage Tax Credit Plans for 2005

Kentucky, Louisiana and New Jersey now offer plans

WASHINGTON, DC -- U.S. Treasury Secretary John W. Snow applauded Governor Fletcher of Kentucky, Governor Blanco of Louisiana and Acting Governor Codey of New Jersey for implementing a state qualified health plan option under the federal Health Coverage Tax Credit Program (HCTC) to help cover the cost of health insurance premiums for certain residents in those states.  The plans went into effect January 1st, allowing citizens of these three states to take full advantage of the Health Coverage Tax Credit through approved health care plans. 

"The HCTC will now bring affordable, quality health care to more hard working families in Kentucky, Louisiana and New Jersey," said Treasury Secretary John Snow.  "The officials in these states have worked hard to ensure thousands of families will have the peace of mind that health care coverage brings.  I applaud their leadership in establishing a qualified plan to provide coverage for eligible individuals and their families."

The Trade Adjustment Assistance Act President Bush signed into law in 2002 included the new Health Coverage Tax Credit (HCTC).  Recipients can receive the HCTC either in advance, to help pay qualified health plan premiums as they come due, or in a lump sum when they file their federal tax returns.  The HCTC advance payments program began nationally in August 2003. This program provides an advanced payment of 65 percent of the premium cost for a qualified health plan for individuals and their families who are eligible to receive Trade Adjustment Assistance (TAA) benefits or certain individuals who receive pension benefit payments from the Pension Benefit Guaranty Corporation (PBGC).

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"The HCTC program is cutting edge tax policy.  Bold ideas like the HCTC will lead the charge for innovative solutions to help real people obtain needed health care coverage in a flexible, reliable way," Snow continued.  "We want to ensure that those who qualify for the credit get the help they need as quickly as possible."

To receive the credit, eligible individuals must enroll in qualified health insurance, such as a COBRA health plan or State Qualified Health Plan (SQHP). Forty states and the District of Columbia have SQHPs that will enable more than 200,000 of those potentially eligible for the HCTC to purchase health coverage.  Nationwide, there are approximately 230,000 individuals potentially eligible for the HCTC.

For more information on a particular state and the health insurance programs that qualify, please visit the HCTC website at www.irs.gov and enter IRS Keyword: HCTC.

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