Congress passed the American Rescue Plan Act (ARPA) in early 2021 to help cushion the blow of the COVID-19 pandemic and kick-start a recovery from the ensuing economic recession. The act included provisions to improve health care affordability, extend unemployment insurance, support small businesses, and increase tax credits for families. ARPA added desperately needed supports for our struggling communities and was lauded by health care advocates as the strongest improvement to our health care system since the passage of the Affordable Care Act.
One of the most critical elements of the act to help improve health care affordability was to expand health care premium tax credits on the marketplace for more people and at higher levels. ARPA made coverage accessible to very low-income families by dropping their monthly premiums to zero, as well as by making additional assistance available to those with higher incomes by guaranteeing that people would spend no more than 8.5% of their incomes on premiums.
Uptake data shows ARPA significantly expanded health care affordability and reduced uninsurance:
- 2022 enrollment in marketplace health coverage reached a record high of 5 million people – 2.5 million more than the prior year, including 3 million new consumers.
- One third of consumers across the country were newly able to get coverage with a premium of $10 per month or less.
- Families saved an average of $2,400 per year, with low-income families saving even more.
- ARPA significantly reduced uninsurance, especially for low-income uninsured Black and Hispanic people, 67% of which became eligible for zero-premium plans.
Here in Washington, three-quarters of 2022 customers now receive federal subsidies on their health plan, up from 61% pre-ARPA. Subsidies also significantly decreased premiums in our state: 42% (100,000 people) now pay a premium of $100 or less per month, up from 29% pre-ARPA. The subsidies also enabled higher numbers of Black, Hispanic/Latino, and younger people (under 35) to enroll.
Congress must act quickly to protect affordable coverage
Without Congressional action, the health care subsidies created by ARPA will expire at the end of 2022. This coincides with the time when consumers begin shopping for 2023 plans – just in time for mid-term elections, as well as the winddown of added resources associated with the end of the official public health emergency.
Our hopes were dashed for a comprehensive Build Back Better package, which would have extended the subsidies, when Senators Manchin and Sinema blocked its passage in late 2021. While Manchin has indicated he might be up for a deal to allow Medicare to negotiate drug prices, he is still not budging on extending subsidies.
However, there is still time to push Congress to include the ARPA subsidy extensions in their reconciliation package, which will include several elements of the former Build Back Better package.
Without ARPA health care subsidies, families will suffer
If Congress is not able to extend subsidies, the U.S. Department of Health and Human Services has estimated that 9 million people will face higher costs, 1.5 million people could stay insured, but will lose all financial assistance, and an additional 3 million will become uninsured entirely.
Our most vulnerable communities will see the greatest impacts. National Partnership for Women and Families has estimated that nearly 8 million women and an additional 4 million Black, Hispanic, and AAPI people could see their insurance costs rise. The Urban Institute estimates that the average premium cost for silver-tier marketplace plans “would increase by an average of $457 for households with incomes under 150 percent of the federal poverty level, by $1,045 for households with incomes between 150 and 400 percent of the federal poverty level, and by $2,003 for households with incomes above 400 percent of the federal poverty level.”
In Washington State, about 52,000 people will become uninsured if subsidies are not renewed. (See the Center for American Progress’ interactive data tool breaking down the impacts state-by-state.)
Health care is a human right: Tell your Members of Congress to take our affordable health care off the chopping block
Even without a comprehensive Build Back Better package, Congress can still extend ARPA subsidies in the reconciliation package now under discussion. Take action by calling your members of Congress to tell them health care should be affordable for all! Reach out to the U.S. House of Representatives by calling 202-225-3121 and the U.S. Senate by calling 202-224-3121.
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