Republicans will present an alternative plan to a Democrat proposal to extend the enhanced Affordable Care Act (ACA) subsidies. The GOP proposal would allow the tax credits to expire but provide money directly to consumers via Health Savings Accounts that they can use for health care. It’s unclear whether either proposal has enough votes to move the legislation forward.
The Senate is expected to vote on Thursday on the Democrats’ plan to extend the enhanced ACA tax credits for three years. The subsidies, which are due to expire at the end of this year, have helped keep premium costs down for millions of consumers who purchase health insurance coverage on the ACA exchanges. Without the extension, KFF estimates that premiums will increase an average of 114 percent from $888 to $1,904.
The expiration of the subsidies led to a standoff over measure to fund the government and the longest government shutdown in U.S. history. A group of Democrats eventually agreed to a short-term measure to fund the government through the end of January in exchange for a vote about the subsidies before they expire on December 31.
But many Republican senators oppose an extension and have worked on a new health care proposal that they claim will reduce the cost of health insurance premiums. The proposed bill, Health Care Freedom for Patients Act: Make Health Care Affordable Again, introduced earlier this week by Senators Bill Cassidy, M.D. (R-La.) and Mike Crapo (R-Idaho), would deposit payments into HSAs paired with bronze or catastrophic plans on the ACA exchanges in 2026 and 2027. Insurance premiums would decrease 11 percent through the cost-sharing reduction payments and adults ages 18-49 who earn less than 700 percent of the federal poverty level would receive $1,000 and those who are aged 50-64 in a similar income bracket would receive $1,500.
“Instead of 100 percent of this money going to insurance companies, let’s give it to patients. By giving them an account that they control, we give them the power. We make health care affordable again,” Cassidy said in an announcement about the proposal.
But Senator Bernie Sanders (I-Vt.) says the GOP proposal would increase health care costs and limit care. In a press release, he said the funding is inefficient and would require working families to switch from gold or silver health insurance plans to less comprehensive coverage with deductibles as high as $10,000 for individuals and $21,200 for families. He released a report that finds ACA marketplace consumers would pay more out-of-pocket costs under the GOP plan even with the funding provided to HSAs.
The proposal does “nothing to prevent premiums from doubling, tripling or even quadrupling for millions of Americans,” Sanders says. “It would do nothing to lower the outrageous cost of health care or prescription drugs. It would do nothing to make it easier for Americans to see a doctor when they get sick.”