Y’all remember a few years ago when folks were complaining that the subsidies proffered with Obamacare (Patient Protection and Affordable Care Act [PPACA]) were not big enough to let folks really get the insurance they needed?
Well, that hasn’t been true since the pandemic hit two years ago. The American Rescue Plan Act [ARPA] (with its $1.9 billion of funding) upped the ante. That let some 15 million folks obtain adequate insurance at most reasonable rates. (The insurance subsidies extend to those who earn less than 4 times the poverty level.)
Except…
The ARPA funding expires at the end of this year. Which is going to cut the subsidies, make it tougher for folks to have adequate health insurance. Not to mention devastate care providers that have not been stymied with a bunch of unpaid health care claims.
That’s why there’s so much action between Chuck Schumer (Senate Majority Leader) and Joe Manchin (West Virginia Senator) to come up with a compromise Build Back Better bill. (Note: Many of those to be devastated by the decreased subsidy are West Virginia voters.) The problem is that making the subsidies permanent isn’t cheap. We could be talking about $ 20 billion in annual expenditures.
If a solution is not found, folks making $ 40K a year (that’s about 3X the federal poverty level) will be saddled with a 55% increase in silver plan costs. The richer folks- those almost at 5X the poverty level would be zapped with a 36% increase in costs- about $ 1800 a year (or 3% of their pre-tax income).
This will cut those covered by Obamacare by at least 3 million folks. Which will radically increase uncompensated care at US hospitals. (That works out to about $3.8 billion, not to mention an expected drop in health care spending by more than $ 11 billion.)
It’s going to be interesting to see what happens over the next few months. Let’s hope those subsidies are renewed before the end of the year.
20 billion is a lot of money. What happens if many people simply cannot afford a 55% increase?
Has the pandemic not just recently showed that people who can’t afford to see doctors are at higher risk for pretty much everything, not only COVID? What happens if they can’t afford treatment? Will they have to give younger folks access to Medicare?
This is hard to graps for me. In Switzerland everybody has to have healthcare. Those who can’t affort it, will be granted subsidies. I think if we didn’t, these people would end up with welfare. In the end, some institution will have to pay?!
I like Chuck Schumer, but will he be able to win this Manchin guy over?
I am a fan of neither of those characters, Tamara. But, I am also hoping that the current omicron 5A variant doesn’t sideline a bunch of Senators that we need to pass the bill!
I had not heard about the expiration of the ARPA subsidy funding. With all the money that was dispersed as a result of COVID why weren’t the subsidies included?
It was a two year allotment, to keep the costs reasonable. But, yes, it should have been made permanent, Cheryl.
WOW that will affect a lot of people. Will they now just go without the care needed if they can’t afford it? Let’s hope substities are renewed.
I am pretty sure they will pass on insurance should the rates escalate. So, we have to hope Congress extends the benefits.
Is it just me? Do the “rules” seem like they are always changing?
I cannot tell if these are ‘good’ or ‘bad.’ I think I am overwhelmed. Fortunately, I get my health care through my wife’s policy via her employer! Whew!
That certainly removes one concern! And, the price is probably pretty good as well, Paul.