Extending the Affordable Care Act’s (ACA) enhanced tax credits before the end of this year has become center stage in Congress’ negotiations to fund the government and avoid a shutdown beyond Sept. 30.
That could affect over 100,000 Connecticut residents who get health care coverage through Access Health CT, the state’s health insurance exchange. Currently, 9 in 10 Connecticut residents on ACA plans benefit from subsidies, according to the state comptroller.
The enhanced premium tax credits, which Congress extended in 2021, allow people to enroll in health coverage at a lower price. The subsidies provide discounts on monthly premiums. They can aid people who don’t get insurance through their employer, or who make over the threshold to qualify for Medicaid, or aren’t yet eligible for Medicare.
Earlier this week, Connecticut Gov. Ned Lamont, along with 17 other governors, spoke out in defense of the Obamacare tax credits. The group sent a letter to Congressional leaders demanding they extend the credits.
“For millions of hard-working Americans, these subsidies are the only reason health insurance is still within reach in a country where the cost of living keeps going up,” the governors wrote.
They warned the inflated premiums will turn health care into an even bigger expense, and people may have to forgo coverage.
“This isn’t a partisan issue. It’s about protecting working people who are doing everything right but still struggling to get by,” the letter continued.
The health care subsidies expire Dec. 31. Open enrollment begins Nov. 1.
‘The storm is here’
Congress members on both sides of the aisle support continuing the tax credit, but some Republicans want to rework the subsidy amounts. Democrats say they won’t support the bill without health subsidies.
If the federal subsidies are not renewed by Congress, the premium increases on average would be $1,700, according to Access Health CT. The cost spike would come at a time when more Connecticut residents are living above the poverty line, but are struggling to make ends meet, the latest ALICE report from United Way showed.
“The storm is here,” said Lisa Tepper Bates, president of United Way Connecticut. “Some of it's already hitting, and some of it is about to hit us.“
The Budget Reconciliation package that Congress passed in July didn't include an extension of premium tax credits. Coupled with deeply cut federal support and eligibility for Medicaid, the Congressional Budget Office projected that nationwide, 14.2 million people could be uninsured by 2034.
Last week, Connecticut insurance regulators also approved an increase in premiums for state regulated plans.
The uncertain future of the subsidies comes as the Trump administration’s massive spending and tax package also made other changes to ACA plans, including not automatically renewing plans on the exchange during enrollment, and shortening the enrollment period. People who are new to getting a plan on the ACA will have to share proof they are eligible for getting the tax credit – currently, people have 90 days to prove their eligibility.
House Republicans pitched a bill Tuesday that would keep the government running through Nov. 21, but the measure didn’t include extending the tax credits under the Affordable Care Act. As NPR reported, House Speaker Mike Johnson said Tuesday that debate around the subsidies should happen in December, not September.
U.S. Rep. Rosa DeLauro, House Appropriations Committee ranking member, called on Congressional Republican House and Senate leadership to join them on a bipartisan plan.
“Instead of continuing to work through important issues with us on the continuing resolution and government funding to help the middle class and the working class, House Republican leadership has walked away from negotiations and are now threatening a shutdown by trying to jam through a funding bill on their terms alone,” a joint statement with Sen. Patty Murray said.
