The fate of the enhanced Obamacare subsidies could be determined this week.
The Senate is scheduled to vote Thursday on a Democratic plan to extend the enhanced tax credits, which are set to expire in just over three weeks, leaving subsidies at their original 2010 levels. That bill is expected to fall short of the 60 votes needed to pass. Republicans, meanwhile, are reportedly leaning against holding a vote on an alternative plan of their own. As they race to see if they can coalesce around a plan and fret about a voter backlash if they can’t put forth a strategy for dealing with rising costs, various Republican senators are offering up competing proposals.
“Some Republicans want a deal to preserve the enhanced subsidies, heading off voter ire and preventing an election-year nightmare scenario for the GOP,” The Hill’s Joseph Choi and Nathaniel Weixel write. “Others want the enhanced subsidies to expire and be replaced by direct cash to Americans, convinced they can blame Democrats for high costs.”
Here's a quick look at some of the GOP plans being proposed.
Moreno and Collins: On Monday, Sens. Bernie Moreno of Ohio and Susan Collins of Maine introduced the “Consumer Affordability and Responsibility Enhancement (CARE) Act,” which would provide a two-year extension of the expiring ACA tax credits but cap eligibility at household income of $200,000 “because wealthy Americans don’t need Uncle Sam’s help buying insurance.” The plan would also eliminate $0 premiums and would require a $25 minimum monthly payment meant to root out fraud.
“Families in Maine and across the country are struggling with the high cost of health care, and we need to pursue practical solutions that increase affordability without creating sudden disruptions in coverage,” Collins said in a statement.
The plan is similar to bipartisan proposals being developed in the House as well as a plan that was floated by the White House but quickly scrapped in the face of pushback from Republican lawmakers.
Marshall: The Kansas Republican, who is a physician, is pitching what he calls “The Marshall Plan Act,” which reportedly would extend the Obamacare subsidies for a year and then, starting in 2027, shift the enhanced premium tax credit funds into an account similar to an HSA. Eligibility for the enhanced subsidies initially would be capped at 700% of the poverty level and would be phased out over five years. The plan also emphasizes increased price transparency for patients, which Marshall says could lead to $1 trillion a year in savings. And it calls for providing funds to states for a “high-risk reinsurance pool program” to help manage the costs of covering people with expensive medical conditions.
Crapo and Cassidy: Sens. Mike Crapo of Idaho, chair of the Senate Finance Committee, and Bill Cassidy of Louisiana, the chair of the health committee, have put forth a bill that would allow the enhanced ACA subsidies to end as scheduled. Their plan would instead expand eligibility for health savings accounts and redirect funding that would have been used for enhanced subsidies into those accounts, which would be paired with bronze or catastrophic ACA plans. It would expand the eligibility for those catastrophic, or “copper,” plans as part of an overall push to shift people to plans with lower premiums and higher deductibles.
“Instead of 100% of this money going to insurance companies, let’s give it to patients,” Cassidy said in a statement. “By giving them an account that they control, we give them the power. We make health care affordable again.”
Eligible enrollees making less than 700% of the federal poverty level would get $1,000 if they are between the ages of 18 and 49, while those aged 50 to 64 would get $1,500, according to a summary released by the senators.
“Senator Cassidy’s health proposal presents tradeoffs,” Larry Levitt of the healthcare research foundation KFF wrote in a Sunday post on X. “Healthier people would benefit from contributions to health savings accounts and low premium high deductible plans. Sicker people would end up with higher premiums or higher deductibles. But, it wouldn’t destabilize the ACA.”
Levitt added in a separate post Monday that the HSA contributions under this plan would be similar to the average increase in out-of-pocket premiums if the enhanced tax credits expire, which is projected to be just over $1,000. “But,” he added, “the average deductible in a bronze plan will be $7,476, so a $1,000 or $1,500 HSA will leave people quite exposed.”
The plan, called the “Health Care Freedom for Patients Act,” would also fund “cost-sharing reduction payments” to lower premiums starting in 2027, cut Medicaid funding to states that provide coverage to undocumented immigrants and prohibit the use of federal money or HSA funds for abortion and transgender services.
Other GOP ideas: Sen. Rick Scott of Florida has proposed a plan that would create “Trump Health Freedom Accounts,” redirecting subsidy money to accounts that could be used to pay for healthcare costs. Sen. Josh Hawley of Missouri wants to let people deduct some medical expenses from their taxes.
The bottom line: Senate Republicans have lots of ideas but haven’t united behind a single plan, nor have they offered a comprehensive overhaul of the U.S. healthcare system. On the House side, Speaker Mike Johnson is reportedly expected to introduce a plan to be voted on later this month. Bipartisan plans are also in the works. Despite all that, it’s still not clear if Congress will act to extend the expiring subsidies or be able to pass any bill to lower healthcare costs.