The temporary expansion of subsidies to lower the cost of plans sold on the Affordable Care Act exchange in the pandemic relief package expires on January 1. In October, just as early voting for the midterm elections begins, insurers typically begin informing consumers of premium prices for the following year.
According to the nonprofit health advocacy group Families USA, nearly all of the 13 million people receiving federal subsidies would see their premiums rise—on average by 53%—and some who have been receiving free healthcare because of the subsidies may lose coverage entirely because they can't afford to pay.
Senators Chuck Schumer (D-NY) and Joe Manchin (D-WVa.) are negotiating which aspects of President Biden's economic agenda might be able to pass on a party-line vote before the November elections. Many Democrats are urging them to include a continuation of health-care subsidies. Democrats have previously campaigned on their efforts to make healthcare more affordable.
A request for comment from Mr. Schumer's office was not returned. Mr. Manchin's spokeswoman said the senator is still concerned about the country's financial situation and is working to reduce the cost of prescription drugs, among other things. The spokeswoman made no direct mention of extending the ACA subsidies.
According to a spokesman for House Speaker Nancy Pelosi (D-Calif.), lowering health-care costs has long been a top priority for House Democrats.
With Republican senators opposed to expanding the ACA, Democrats will almost certainly have to go it alone in extending the subsidies.
Many Republicans and conservative health-policy leaders oppose keeping the subsidies in place because it would increase federal spending. According to a Congressional Budget Office analysis, making the more generous subsidy assistance permanent would cost $220 billion over the first ten years.
Senator Roy Blunt (R-MO) said the additional subsidies are costly and benefit a higher income group than the ACA was intended to help. He believes no Republican would vote to extend them.
"I don't believe this is our problem," he explained. "Whenever you give someone free money and then take it away from them, they want to keep it."
According to Chris Pope, a senior fellow at the Manhattan Institute, a conservative think tank focused on domestic policy, extending or making subsidies permanent could put more upward pressure on premiums.
"That is massively inflationary," he said. "There's a push to rush this through before they file their rates."
The increased subsidy assistance was included in the American Rescue Plan Act of 2021, or ARPA, a $1.9 trillion economic stimulus package. Mr. Biden has worked to strengthen the ACA and increase the number of people who use it to purchase health insurance. Making the additional premium subsidies permanent would be an important step toward achieving that campaign goal.
Because premiums for next year are typically finalized by the end of summer, Congress would need to act before departing for its August recess.
The federal exchange for the Affordable Care Act, HealthCare.gov, typically opens in the fall for window shopping, which is when customers go online to learn if they qualify for subsidies and what their premium costs are likely to be.
According to Kaiser Family Foundation data, the average monthly premium in Wyoming for people who receive subsidies with additional premium help from Congress was $88. Without the additional financial assistance, it would be $203, or 132 percent higher. In Alaska, the average monthly premium difference with the increased subsidies was $158 compared to $255 without, a 62 percent difference.
"Because it directly affects American families on the critical issue of healthcare, I hope we can find bipartisan support for it," said Senator Dick Durbin (D., Ill.)
In the previous midterm congressional elections, Democrats campaigned on expanding access to healthcare. According to a March Pew Research Center poll, healthcare is a top issue for Democratic voters ahead of the midterm elections, with 74% saying it is very important to their vote. Healthcare was ranked as the top issue by 44 percent of Republican voters.
However, the price increases may not have a significant impact on voters because the majority of people obtain health insurance through their jobs and are unlikely to be affected by the higher premiums on the ACA marketplace. Almost 155 million people have employer-sponsored health insurance, compared to a record 14.5 million enrolled in the ACA exchange this year.
"It's another economic problem for the administration," said Robert Blendon, a Harvard University emeritus health-policy professor. "It will be an issue for people, but will it be an issue for voters?" "Not so much."
In a May 23 letter, Rep. Lauren Underwood (D-Ill.) and 25 other Democrats urged Democratic leadership to include extending the subsidies as part of budget reconciliation, which is what Messrs. Schumer and Manchin are negotiating. Reconciliation is a process that allows lawmakers to pass budget-related legislation with a simple majority.
Rep. Suzan DelBene (D-Washington), chairwoman of the centrist New Democrat Coalition, believes there is broad Democratic support for extending subsidy assistance and addressing prescription-drug pricing through reconciliation.
"There is a sense of urgency," she said. "We need to give people certainty."
Families USA executive director Frederick Isasi stated that extending and making permanent the subsidy assistance would provide financial security for families. Otherwise, he claims, many Americans will lose coverage, just as Covid-19 cases are expected to rise in the fall and winter.
He estimates that the costs to people receiving expiring federal subsidies will rise by about $12 billion. "That is an absurdly large increase." It should be a last-ditch effort by Democrats to get this to the president's desk."