Editor’s Note: Heather Korbulic is the Senior Policy and Strategy Officer at GetInsured, where she helps health policy makers develop strategies for the delivery of health care and other public benefits. She was previously executive director of Nevada’s health insurance market, the Silver State Health Insurance Exchange.
The COVID-19 pandemic has forced the United States to face a health insurance crisis it did not anticipate. Congress and the Biden administration responded by passing policies to expand access to subsidized private health plans sold through Affordable Care Act swaps.
The results have been nothing short of spectacular: less than 10% of Americans are uninsured, down from nearly 22% in 2010. In addition, a record 14.5 million consumers are enrolled in an insurance exchange plan. state health insurance.
However, unless Congress acts, the subsidies will expire at the end of the year and millions of Americans will experience dramatic price increases, become uninsured and likely rack up medical debt.
The American Rescue Plan (ARP) provided consumers with lower premiums and access to premium tax credits, regardless of income. This has made health insurance more affordable for individuals and families, resulting in a record 21% increase in public health exchange enrollments over previous coverage years.
State-based exchanges enrolled an additional 600,000 people, according to the National Academy for State Health Policy, which also reported that average premium savings ranged from 7% to 47% in exchanges. of state. Additionally, 20% or more of enrollees pay less than $25 per month for coverage in at least eight states. It is a significant achievement to make health insurance affordable for those who once considered coverage financially out of reach.
Returning consumers can even save, on average, 40% on their monthly premiums thanks to the improved tax credits in the ARP, according to the CMS. These changes are possible because the federal government reduced the salary cap for tax credits, recognizing a universe of low- and middle-income people who earned too much to qualify for Medicaid but found the prices of most plans insurance out of reach.
In some cases, credits have saved thousands of people a year. The cost, for example, of a “silver” health plan is currently $390 per month with subsidies for people earning $55,000 per year, up from $560 per month.
Unfortunately, these cost savings can come to an end, leaving individuals with the difficult decision of whether to pay for coverage or pay for basic necessities. More often than not, the latter wins. Getting insurance from an employer isn’t always a better (or even viable) option, as premiums for employer-sponsored plans increased 3.6% in 2021 and 3.9% in 2020, according to the Urban Institute.
The impending expiration, which could leave millions uninsured, comes at a time when Americans are resuming regular doctor visits and COVID-19 cases are on the rise again. The conditions are met for the health crisis to explode again. And so will the nation’s growing medical debt problem, as people without insurance struggle with doctor bills they can’t afford to pay.
Research by the Consumer Finance Protection Bureau showed $88 billion in medical debt on Americans’ credit reports in June of last year. According to the White House – which has just announced measures to ease this economic burden – one in three American adults has medical debt, a number likely to rise as subsidies expire and many lose medical coverage.
It is the most common type of debt collection and, although different from other debts in that it has been incurred through faultlessness or accidentally, it can nevertheless have a negative impact on an individual’s finances and prevent them from seeking medical care. additional.
Congress could preempt this brewing crisis by extending the enhanced premium subsidies. The Build Back Better Act (BBBA), which never left the Senate, would extend these improvements to 2025. New discussions of reviving parts of the BBBA have even considered a 10-year extension to 2032. Democrats were hoping for a move by Memorial Day, but that soft deadline quickly passed.
Regardless of the length of any extension, it is imperative that Congress takes action this summer at the latest to avoid confusion when states begin their open enrollment period for individuals to enroll in pension plans. insurance. Delaying further will lead to widespread confusion and millions of consumers could choose to go without coverage, both risking their health and exposing themselves to possible medical debt.
We took two steps forward to increase access to affordable health care coverage for Americans. Let’s not take three steps back.