Thanks to the Biden Administration and Democrats in Congress, the Inflation Reduction Act Extended Premium Subsidies to Millions of Americans Through 2025
On November 1, the open enrollment period for the Affordable Care Act (ACA) marketplaces will begin. Americans have until December 15 to enroll in coverage that starts at the beginning of 2023, and several state-based exchanges will allow for enrollment beyond this deadline. Under new legislation recently passed by Congress, high-quality coverage through the ACA marketplaces is more affordable than ever.
President Biden and Democrats in Congress have been laser focused on making health care more affordable for Americans. The Inflation Reduction Act lowers health care costs and expands eligibility for millions of Americans. In 2021, the American Rescue Plan expanded premium subsidy eligibility to those making over 400 percent of the federal poverty line and capped premium costs at 8.5 percent of family income across the board. The Inflation Reduction Act extends those subsidies through 2025, keeping a lifeline available for families across the country. 13 million Americans are now covered by the ACA, with 3.2 million paying less than $10 per month for premiums. President Biden also recently finalized a fix to the “family glitch,” which will allow even more families to access affordable coverage.
These enhanced premium subsidies, as well as substantial funding increases for Marketplace education and outreach, have boosted the number of people of color who are now covered by health insurance. Black Americans saw a nearly 50 percent increase in health care enrollment since 2020, Hispanic Americans saw a 53 percent increase, and Alaska Native Americans saw 32 percent increase. Ahead of this open enrollment period, the Biden administration announced the single-largest investment ever in the Navigators program, to help connect even more people to coverage,with a focus on outreach to racial and ethnic minorities, people in rural communities, LGBTQ+ communities, and other particularly underserved communities.
The open enrollment period is crucial for not only those looking for coverage, but also for families who may already be covered. At a time of rising costs, even people who already have health coverage should go to HealthCare.gov to check if more affordable plan options are available to them.
BY THE NUMBERS: Americans Will Save Big On Health Care
- In 2021, 14.5 million people signed up for coverage through an ACA marketplace, the highest number of Americans to ever enroll during open enrollment
- 13 million Americans, or 89 percent of people with an ACA plan, will save an average of $800 per year and $2,400 per family on health insurance premiums
- 3.2 million Americans now have health coverage for less than $10 per month
What’s New This Open Enrollment:
Caps on the Amount of Money Families Pay for Health Insurance. The Inflation Reduction Act ensures families pay no more than 8.5 percent of their income towards coverage. This helps middle and working-class families, as well as older Americans, who have traditionally faced excessive premiums or live in high-premium areas. Before the American Rescue Plan, middle-class families spent an average of 15 percent of their incomes on health insurance. The subsidies are designed to benefit those who need it most, which means the higher your income, the smaller your tax credits become. A family whose health insurance premiums alone — not including deductibles — are less than 8.5 percent of their income receive no tax credits at all.
Addressing Health Care Equity By Expanding Coverage for Communities of Color. The Center on Budget Policy and Priorities estimates the increased savings continued under the Inflation Reduction Act will cause a sharp decline in the uninsured rate across every racial group, with one in three uninsured Black adults expected to gain coverage. Prior to the American Rescue Plan, more than 11 million uninsured adults were eligible for premium tax credits, with people of color making up roughly half of the group. The premium savings continued in the Inflation Reduction Act have made more than 65 percent of uninsured Black adults eligible for zero dollar premium plans and 75 percent eligible for plans less than $50 a month. For uninsured Hispanic and Latino adults, now more than 68 percent are eligible for zero dollar premium plans and nearly 80 percent can access plans for less than $50 a month. Health coverage is imperative to reducing racial disparities across the nation.
Eliminating Premiums For Low-Wage Workers. The Inflation Reduction Act ensures no American with an income at or below 150 percent of the federal poverty level buying their coverage on the Marketplace pays a premium.
Cutting Costs For Rural America. Thanks to the provisions in the Inflation Reduction Act, roughly 65 percent of rural Americans have access to zero dollar premium health coverage and more than 76 percent are able to find a plan for less than $50 a month, narrowing the coverage differences between rural and urban America.
No More Family Glitch. A new rule to fix the “family glitch,” where families were blocked from receiving premium subsidies if someone in their household had access to affordable health care through employment, even if the whole family wasn’t covered by that insurance, was recently implemented by the Biden Administration. The new rule will more realistically determine what is considered affordable for families, allowing an additional 1 million people to be eligible for affordable health care on the marketplace and receive premium subsidies.