Vice President for Health Policy
The House is expected to vote today on a bill that would lead 4 million people to gain health coverage, the Congressional Budget Office estimates, while making coverage more affordable for at least 13 million more, likely benefiting well over 17 million people in total. The Patient Protection and Affordable Care Enhancement Act would strengthen both the Affordable Care Act (ACA) marketplaces and Medicaid. These improvements are especially important given that millions of people have likely lost job-based health insurance in recent weeks due to the deep economic downturn, many of whom will become uninsured if they lack access to these programs.
The ACA’s premium tax credits and cost-sharing assistance for marketplace plans have helped millions gain coverage. But many people who are eligible for this assistance remain uninsured, often because they can’t afford the premiums even with premium tax credits. Despite ACA financial assistance, uninsured rates remain much higher among lower-income people. State programs that supplement the ACA premium tax credits substantially increase enrollment in coverage, studies show, confirming that cost is a key barrier.
The House bill would boost marketplace financial assistance significantly. For low- and moderate-income people who already qualify for premium tax credits, it would sharply cut net premiums (the cost after factoring in the tax credits), including eliminating premiums for enrollees with incomes below 150 percent of the poverty line (about $19,000 for a single adult). It would also extend eligibility for the credits to middle-income people facing high premium burdens, capping net premiums at 8.5 percent of income. (See figure.)
These improvements would benefit over 10 million people who already buy marketplace or other ACA coverage (including 8.9 million people who already qualify for premium tax credits and at least 1.3 million who’d be newly eligible) and provide more affordable options to millions of people now uninsured.
Other parts of the bill would also expand access to marketplace coverage or make it more affordable, by:
By expanding premium tax credits, lowering sticker price premiums, and making subsidized marketplace coverage available to more people with unaffordable employer plans, the bill would make lower-premium options available to all of the roughly 13 million people who purchase ACA coverage, plus additional people now paying high premiums for employer coverage.
Under the ACA, states can expand Medicaid to adults with incomes up to 138 percent of the poverty line. Expansion has increased coverage, improved access to care, reduced individuals’ medical debt and providers’ uncompensated care costs, and averted thousands of premature deaths. But 15 states still haven’t implemented expansion, leaving about 4 million people uninsured.
Under the House bill, the federal government would pay 100 percent of expansion costs for the first three years as it did for 2014 to 2016, when expansion first took effect. (The current share is 90 percent.) Expansion is already producing net savings for many states because they pay only 10 percent of the cost and because expanding coverage reduces states’ costs for uncompensated care, behavioral health, and other programs. Under the House bill, expansion by additional states would be a clear boon to those states’ budgets, at a time when most states are struggling with huge, recession-induced budget shortfalls due to sharp declines in their tax revenues.
The bill’s other important Medicaid improvements include: