Didn’t want to hijack the “why blame Democrats for the shutdown?” thread.
IMHO, the ACA subsidies will probably be rescued at the last moment in December. But supposing that they are not, and in fact are lost for good, the consequences will be pretty severe. Some projections, IIRC, state that some Americans will only pay an extra $1,000 per year, but some families could be on the hook for tens of thousands of dollars. Some folks are going to be utterly crushed, monetarily, and may even need to gamble with their health by going uninsured.
How bad is it going to be for most folks? I’m thinking of putting it into my contingency plans; if I lose my job and its health insurance, and the lack of ACA subsidies makes health insurance exorbitantly expensive, I’m going to move overseas to where I have dual citizenship and enrollment in the single-payer healthcare there and work there not come back to the USA until I get a new American job or ACA is made affordable again.
So my understanding is that it’s the enhanced subsidies, enacted during COVID, that are going away, not ACA subsidies in general. There are still the baseline subsidies that exist when the law went into effect, including the cost sharing reductions, as well as the original ACA tax credits for premiums. The enhanced subsidies helped people with higher income more than they did people with lower income – if you make $50,000 a year you got a bigger additional subsidy from the enhanced subsidies than someone who made $25,000 a year.
So the lapse of the enhanced subsidies will hurt people who are relatively more able to afford it, though with the price of everything going up and people struggling that may end up not being such an important point. But people who are near the minimum income to make too much from medicaid (somewhere around $20,000) will see an increase of perhaps $150 a month in premiums whereas the stories you hear of people who have their subsidies doubled or more are probably people who are near the high end of the limit for ACA subsidies anyway.
CSRs which are flexible benefits given to plans for people with low enough income still remain. There are various offerings which can give people a lower deductable, lower premium, lower out of pocket max, etc. depending on how the plan is designed. These are a significant part of the overall subsidies for low income people that most people do not mention because they focus only on the monthly premium.
I’m not making any particular point about how good or bad it is with that, I just want to clarify where the lapse of the enhanced subsidies are going to hurt. The ACA existed without those subsidies for 10+ years, so we’re returning to the long term normal rather than stripping out what the ACA originally provided. However, since medical costs and insurance costs go up every year, the enhanced subsidies took a lot of the pain away from the price increases the medical insurance business has seen, so even if the ACA subsidies were okay in 2010, that may not be the case in 2025.
My hope is that it would force lawmakers to look at health care costs holisitically. ACA does not promote affordable health care; it subsidizes health insurance which, while it might be better than no insurance, does nothing to control the cost for medical care in the US with the high cost of medications, paying out-of-pocket for hospital stays, specialists, examinations by machines that go ping. I would also legislate that difficulty in paying medical costs cannot be reported the the Big-3 CRAs so financial difficulty in paying those bills does not harm a person’s credit.
Are you saying that you think lawmakers don’t know (1) that health costs are unnecessarily high, (2) that ACA subsidizes insurance rather than reducing healthcare costs, and (3) that every single one of the universal healthcare models currently available would be better for the American people overall?
Because I think they already know all of these things, but like the money that flows their way from the insurance industry.
I live in Illinois which has pulled out of the marketplace and set up GetCoveredIllinois. Checking things out there since open enrollment has started I am finding out that my health plan will go from $315/mo to $860/mo. This is due to the fact that Illinois will not be offering a tax credit to anyone who earns over 400% of the federal poverty level (FPL). It appears this didn’t apply under the ACA but maybe it’s because Congress has to extend something beyond 2025.
Given I am 63 and will be able to go on Medicare in 2 years I suppose I will have to find a way to tighten my belt financially and come up with the additional ~$13,000 I will need to pay for the next two years. I’m not happy about it but I don’t really see any other option. Certainly forgoing health insurance is out of the question even though I don’t have any health issues. I guess I should just be happy I can afford to pay for it for a couple of years.
I think politicians like to tweak one little thing or the other rather than creating wholesale change. It’s like our immigration issues. Politicians will fix one part of it but overall it is still broken because it needs an overall overhaul.
@SenorBeef explained it pretty well. I’m someone who has been on an ACA plan since it began and I’ve never qualified for subsidies. I have my own business, comprised of 2 people who live in different states. Previously to get health insurance we had to be a member of our local business consortium and then we could be on their group health plan, which was expensive. When the ACA hit, we dropped the consortium and each of us is able to buy our own plans from a much much wider array of plans than what was offered by the consortium. And they were cheaper.
The existence of the ACA marketplace has been a boon for us, but neither of us has ever gotten subsidies because we make too much. Yay for us I guess? We’re also able to have the company give us monthly stipends to cover the costs.
Nothing really changed for me wrt my plan this year. The cost did go up 22% but it has gone up every year.
I guess I’m in the minority, though. 92% of ACA users do get a subsidy.
The ACA is not a problem. It is no worse than what employers are paying for health insurance. The problem is health insurance costs period. The subsidies are great and they are needed, but at the end of the day it is really just the government funneling money into for-profit health insurance company bottom lines.
Being a heathen from a country with universal cover where experiencing an acute medical condition won’t bankrupt you (and just having experienced such an acute condition), I saw a recent clip from the NYT on the “online health insurance market” that families in several states on annual incomes of $85k are looking of an increase of $15-20k. Gazooks!
The increase alone represents 20% of a family income?
I don’t pay that increase in my annual UHC premiums.
This could certainly lead to a situation where healthy people decide to forego insurance, resulting in still higher costs, resulting in more people dropping insurance, etc.
How are you going to do that? Not that your idea isn’t worthy, but I’m not sure how you’d actually enforce that or even figure it out.
I mean, if someone has a credit card balance, gets sick, and spends their money on health care, and meanwhile doesn’t pay their credit card bill, all the credit bureaus see is that the person bought a TV, a few meals out, and some gasoline, then failed to pay for it. They wouldn’t have any idea that the reason someone can’t pay is because of other healthcare expenses that aren’t on their credit card.
The subsidies are capped at 400% FPL
For a family of two that’s $84,600 annually. Previously it was up to 700% and that has not been extended. That’s where the talking point from republicans about a couple making 600k a year were eligible for a subsidy. But what they would conveniently leave out is that couple would also have a family size of 14 children.
So it’s back to 400% fpl. NTL the costs of premiums has risen significantly even with the subsidy.
It’s going to depend on how the law is written. NY’s law defines medical debt so as to exclude credit card debt of the sort you describe.
MEDICAL DEBT DOES NOT INCLUDE DEBT CHARGED TO A CREDIT CARD UNLESS THE CREDIT CARD IS ISSUED UNDER AN OPEN-ENDED OR CLOSED-END PLAN OFFEREDSPECIFICALLY FOR THE PAYMENT OF HEALTH CARE SERVICES, PRODUCTS, OR DEVICES PROVIDED TO A PERSON.
So the balance , payments etc for the credit card you used to buy the steak, tv etc can still be reported. Even if you also used that card to pay medical bills. But the $80K hospital bill you owe, or the $200 doctor bill or the balance on the credit card that can only be used for medical bills can’t be reported or affect your credit rating. ( One card I know of is Care Credit - can be used only for bills that qualify as “medical debt” under the NY law)