Relief-and-stimulus bill would expand Obamacare tax credits

By Bruce Maples

Kentucky Health News

Stimulus checks. Funding for vaccines. Larger unemployment checks. Money to open schools.

All these are features of the coronavirus relief-and-stimulus package that passed the House and is now in the Senate. And you’ve probably heard of all of them.

But one important feature you probably haven’t heard much about is changes to health insurance – specifically, changes to the Patient Protection and Affordable Care Act, otherwise known as Obamacare.

And the reason that you haven’t heard much about it is that all sides pretty much agree with the changes: Democrats see them as relatively minor, Republicans have begun downplaying their opposition to the ACA, and industry lobbies support most of the changes, Benjy Sarlin reports for NBC News.

The changes “would address one of the most persistent complaints about the law among customers and political opponents alike: sky-high premiums for people who don't qualify for federal tax credits to help pay them,” Sarlin reports.

Under Obamacare, federal tax credits help you pay for insurance, but if you earn more than 400% of the federal poverty line ($51,520 for an single person), you fall off the “subsidy cliff” and have to pay full price … and those premiums can be very high, Sarlin notes.

The relief bill would expand those credits to higher earners, and cap the premiums at 8.5% of income, for the next two years. Also, people making lower than 150% of the poverty line would pay nothing for certain types of plans.

For the most part, the only people opposed to this change are deficit hawks, Sarlin reports. Industry groups support it, because it would pump more money into the system without asking them to cut costs or pay new taxes. “Democrats are expected to try to make it permanent in a future bill,” NBC reported in its “First Read” newsletter.

Sarlin notes, "The nonpartisan Congressional Budget Office estimates that the added subsidies would cost $34 billion and that they would insure 1.3 million more people by next year."