Coverage is More Affordable Than Ever Before Thanks to the Inflation Reduction Act
Thursday, December 15 marks the end of open enrollment for the Affordable Care Act (ACA) marketplaces in most states. While some state-based exchanges allow for enrollment beyond this deadline, there has never been a better time to get covered. Thanks to the Inflation Reduction Act, high-quality coverage through the ACA marketplaces is more affordable than ever before.
The Inflation Reduction Act lowers health care costs and expands coverage to 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. A record number of Americans are now covered under the ACA, with 13 million Americans saving an average of $800 per year on health care.
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.
President Biden and Democrats in Congress have been laser-focused on making health care more affordable for Americans. 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. President Biden also finalized a fix to the “family glitch,” which will allow even more families to access affordable coverage.
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 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
- Thanks to the Inflation Reduction Act, 3 million more Americans will gain health insurance
- 4 out of 5 enrollees qualify for a marketplace plan that is $10 or less per month
- 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
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 these expanded subsidies, middle-class families spent an average of 15 percent of their incomes on health insurance.
No More Family Glitch. The Biden administration implemented a new rule to fix the “family glitch,” which blocked families from receiving premium subsidies if someone in their household had access to health care through employment, even if the whole family wasn’t covered by that insurance. 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.
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.
Making Health Care More Equitable For The American People:
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. 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.
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.