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Millions of Americans Could Pay More for Their Health Premiums if Congress Fails to Extend the American Rescue Plan Tax Credits

As the health care savings under the American Rescue Plan are set to expire, millions of Americans are facing dramatic increases in their 2023 health insurance premiums. Just this week, 14 Democratic governors from across the nation wrote a letter to congressional leadership urging them to extend the premium tax credits now. Failure to extend the tax credits means nine million Americans would pay more for their health care at a time families are already concerned about keeping up with rising costs — and as many as three million Americans could lose coverage altogether. Recent coverage and opinion pieces underscore the importance of preventing this health care “disaster” and ensuring families can continue to afford the health care they need. 

CNBC: Health Insurance Premiums Poised To Jump Next Year For 13 Million People Unless Congress Extends Expanded Subsidies For Marketplace Coverage. “Unless Congress takes action, enhanced premium subsidies — technically, tax credits — that have been in place for 2021 and 2022 will disappear after this year. The change would affect 13 million of the 14.5 million people who get their health insurance through the federal exchange or their state’s marketplace.” [CNBC, 6/27/22]

The Hill: Democratic Governors Urge Congress To Avert ‘Disastrous’ Obamacare Premium Hike. “If the enhanced subsidies expire, it would return the Affordable Care Act to its pre-2021 levels of financial assistance. But the premium increases would be substantial, with an average increase of about 53 percent affecting roughly 13 million people, according to the Kaiser Family Foundation.” [The Hill, 6/29/22]

Los Angeles Times: Californians Brace For Increased Healthcare Premiums If Federal Subsidies Expire. “Federal subsidies passed as part of a temporary pandemic relief package have drastically cut how much he pays in healthcare premiums, allowing the Sacramento-area small-business owner to purchase an insurance plan during the last two years that provided better coverage for his shoulder and knee replacements. Those federal subsidies, however, will expire at the end of this year if Congress does not extend the program. [Syd Winlock’s] ‘very manageable’ price — about $700 a month for him and his wife — will increase to $2,300.” [6/20/22]

Washington Post (Opinion): The Looming Disaster On Obamacare Subsidies Keeps Looking Worse. “When the enhancements expire, many of those millions will see those premiums spike by hundreds of dollars on average, and 3 million could lose coverage entirely. This is important as a political matter because even if the enhanced subsidies don’t expire until the end of the year, some time before then — probably in October, right before the election — insurers will begin notifying people of newly increased premiums. Imagine a wave of local news stories with shots of struggling parents gazing with consternation at those letters.” [Washington Post, 6/29/22]

Bloomberg (Editorial): A Health-Care Cliff Could Leave Millions Uninsured. “Last year’s $1.9 trillion Covid relief package also increased and expanded premium tax credits for Affordable Care Act insurance. As a result, signups rose to a record 14.5 million in 2022 and premium payments halved for millions of enrollees…The enhanced premium subsidies will expire by year-end, though insurers are already submitting their 2023 plans to state regulators.” [6/30/22]

Reports & Research

Kaiser Family Foundation: How ACA Premiums Would Change For People Losing Rescue Plan Subsidies. “If the ARPA subsidies expire, premium payments will increase across the board for all 13 million subsidized Marketplace enrollees. But the approximately one million people with incomes above four times the poverty level will face a double whammy: Not only will many of them lose subsidies, but they will also have to start paying for any increase in the unsubsidized premium beyond that. The reality is that for many people, such an increase in premium payments would be unaffordable, leading them to drop their health coverage.” [Kaiser Family Foundation, 6/30/22]

Health Affairs: Delays Extending The American Rescue Plan’s Health Insurance Subsidies Will Raise Premiums And Reduce Coverage. “Lower-income consumers with low or zero premiums may experience “rate shock” at premiums returning to pre-ARPA levels. Middle-income consumers who are receiving financial help for the first time under the ARPA will again have no protection against premiums—a particular concern for older enrollees and those in high-price states such as West Virginia and Wyoming. Consumers slated for automatic re-enrollment may opt out, resulting in much lower renewal rates. Consumers may write off the idea of re-enrolling and stop opening Marketplace mail or reading electronic communications — meaning they won’t find out if an extension is later enacted. They may remove the premium from their budget planning for the following year and commit those funds to other purposes. Even consumers who do decide to shop may lose trust in the Marketplace and be less likely to enroll.” [Health Affairs, 6/5/22]

In The States

(WI) Wisconsin Examiner: Tax Credits That Lowered My Family’s Health Care Costs Are At Risk. Yours May Be, Too. “The American Rescue Plan, which passed Congress without a single Republican vote and was signed into law by President Joe Biden, included enhanced premium tax credits for those, like my family, who purchase their health care through the Obamacare marketplace…Now, it’s time to build on that progress once again, by extending the Advanced Premium Tax Credits that were part of the American Rescue Plan.” [Wisconsin Examiner, 6/30/22]

(WI) Up North News: Pandemic Relief Helped Millions Needing Health Insurance. Only Congress Can Ensure Their Coverage Won’t Expire. “We know that when people are as healthy as possible, they thrive. Not only is keeping people healthy the right thing to do morally, but it is also good for our country to have a healthy community living their lives to their fullest potential. We need to make sure the ACA COVID subsidies are extended and keep the path clear for people to have a better future.” [Up North News, 6/14/22]

(WI) Up North News: Wisconsin Republicans Willing To Let Health Insurance Premiums Skyrocket. “Among the provisions in the American Rescue Plan signed into law by President Joe Biden last year were advanced premium tax credits for health insurance plans purchased on the Obamacare exchange. The lower premiums that resulted from the enhanced tax credits led to more than 14.5 million Americans purchasing healthcare on the Obamacare exchange in 2021, a record…With inflation continuing to hit working families hard, only one party is working to ease the burden on pocketbooks by lowering healthcare costs — the Democratic Party.” [Up North News, 6/3/22]

(OH) Toledo Blade: Only Congress Can Stop Skyrocketing Health-Insurance Premiums. “The ARP included life-changing tax credits…All of this progress, however, is hanging in the balance. If Congress does not act, these tax credits will expire at the end of this year, and premiums will suddenly rise for middle class families at the beginning of 2023. Open enrollment for 2023 plans begins on November 1st this year. There isn’t a moment to waste — Congress should act immediately to make the ARP’s tax credits a permanent part of the Affordable Care Act.” [Toledo Blade, 6/29/22]