Certified Application Counselor Practice Test

What is the primary benefit of Cost-Sharing Reductions for consumers?

1. Increased tax refunds

2. Decreased tax liability

3. Reduced after-tax income

4. Lower out-of-pocket healthcare expenditures

The correct answer is: Lower out-of-pocket healthcare expenditures

Lower out-of-pocket healthcare expenditures is the primary benefit of Cost-Sharing Reductions (CSRs) for consumers. CSRs are designed to make healthcare more affordable for individuals and families with low to moderate incomes by reducing the amount that they must pay out-of-pocket for medical services. This includes lower copayments, deductibles, and other cost-sharing requirements when accessing essential health services. By decreasing these out-of-pocket costs, CSRs effectively lower the financial barriers for consumers when they seek medical care, making it more accessible to them. This is particularly important for those who may struggle with healthcare expenses, as it helps ensure that they can receive necessary services without facing overwhelming financial hardship. Other options, such as increased tax refunds or decreased tax liability, do not directly pertain to the function of CSRs, which specifically target healthcare cost burdens rather than tax-related benefits. Additionally, reduced after-tax income is not a goal of CSRs; rather, the focus is on alleviating healthcare costs.