subsidies

1 of 3 | House Minority Leader Hakeem Jeffries, D-NY, said Sunday that he expects the House to pass a three-year extension of tax credits for people buy health insurance through Affordable Care Act exchanges. Photo by Bonnie Cash/UPI | License Photo

Dec. 21 (UPI) — House Minority Leader Rep. Hakeem Jeffries, R-N.Y., said Sunday that he expects lawmakers to pass a bipartisan compromise on extending Affordable Care Act tax credits.

Jeffries said on ABC News’ “This Week” that lawmakers will pass a bi-partisan compromise to extend ACA tax credits extension in the House, potentially forcing Senate Republicans hand on health insurance subsidies for at least 22 million Americans who will face higher premiums in the new year.

Congress adjourned for Christmas without reaching a deal on extending on the tax credits, which Jeffries promised that House lawmakers will address in early January.

“That will put pressure on John Thune and Senate Republicans to actually do the right thing by the American people, pass a straightforward extension of the Affordable Care Act tax credits, so we can keep health care affordable for tens of millions of Americans who deserve to be able to go see a doctor when they need one,” Jeffries said.

Democrats have said if the two sides are unable to reach a deal on an extension, they will wield it against Republicans in next year’s midterm elections.

Rep. Pat Ryan, D-N.Y., has said access to affordable health care remains among the most pressing issues among voters.

“It’s just pathetic,” Ryan said. “The last time there was a major national Republican effort to repeal the ACA, we had an overwhelming wave where they got absolutely wiped out, and I think that’s likely what will happen here again.”

A handful of centrist Republicans in vulnerable congressional districts bypassed the authority of House Speaker Mike Johnson to team up with key Democrats to authorize a vote on a three-year tax credit extension when the House returns to Washington the week of Jan. 5.

Some Republican leaders have said they favor allowing Covid-era tax credits that made health care more affordable for millions of Americans to expire or be phased out over several years. Other members of the GOP, however, have said they favor extending the credits for longer.

By a vote of 51-48 Thursday, the Senate rejected a three year ACA extension with four Democrats joining the GOP to vote it down.

An expanded federal healthcare subsidy that grew out of the pandemic looks all but certain to expire on December 31, as Republican leaders in the United States faced a rebellion from within their own ranks.

On Wednesday, four centrist Republicans in the House of Representatives broke with their party’s leadership to support a Democratic-backed extension for the healthcare subsidies under the Affordable Care Act (ACA), sometimes called “Obamacare”.

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By a vote of 204 to 203, the House voted to stop the last-minute move by Democrats, aided by four Republicans, to force quick votes on a three-year extension of the Affordable Care Act subsidy.

Democrats loudly protested, accusing Republican leadership of gavelling an end to the vote prematurely while some members were still trying to vote.

“That’s outrageous,” Democratic Representative Jim McGovern of Massachusetts yelled at Republican leadership.

Some of the 24 million Americans who buy their health insurance through the ACA programme could face sharply higher costs beginning on January 1 without action by Congress.

Twenty-six House members had not yet voted – and some were actively trying to do so – when the House Republican leadership gavelled the vote closed on Wednesday. It is rare but not unprecedented for House leadership to cut a contested vote short.

Democratic Representative Rosa DeLauro of Connecticut said the decision prevented some Democrats from voting.

“Listen, it’s playing games when people’s lives are at stake,” DeLauro said. “They jettisoned it.”

It was the latest episode of congressional discord over the subsidies, which are slated to expire at the end of the year.

The vote also offered another key test to the Republican leadership of House Speaker Mike Johnson. Normally, Johnson determines which bills to bring to a House vote, but recently, his power has been circumvented by a series of “discharge petitions”, wherein a majority of representatives sign a petition to force a vote.

In a series of quickfire manoeuvres on Wednesday, Democrats resorted to one such discharge petition to force a vote on the healthcare subsidies in the new year.

They were joined by the four centrist Republicans: Mike Lawler of New York and Brian Fitzpatrick, Robert Bresnahan and Ryan MacKenzie of Pennsylvania.

The Democratic proposal would see the subsidies extended for three years.

But Republicans have largely rallied around their own proposal, a bill called the Lower Health Care Premiums for All Americans Act. It would reduce some insurance premiums, though critics argue it would raise others, and it would also reduce healthcare subsidies overall.

The nonpartisan Congressional Budget Office (CBO) on Tuesday said the legislation would decrease the number of people with health insurance by an average of 100,000 per year through 2035.

Its money-saving provisions would reduce federal deficits by $35.6bn, the CBO said.

Republicans have a narrow 220-seat majority in the 435-seat House of Representatives, and Democrats are hoping to flip the chamber to their control in the 2026 midterm elections.

Three of the four Republicans who sided with the Democrats over the discharge petition are from the swing state of Pennsylvania, where voters could lean right or left.

Affordability has emerged as a central question ahead of the 2026 midterms.

Even if the Republican-controlled House manages to pass a healthcare bill this week, it is unlikely to be taken up by the Senate before Congress begins a looming end-of-year recess that would stop legislative action until January 5.

By then, millions of Americans will be looking at significantly more expensive health insurance premiums that could prompt some to go without coverage.

Wednesday’s House floor battle could embolden Democrats and some Republicans to revisit the issue in January, even though higher premiums will already be in the pipeline.

Referring to the House debate, moderate Republican Senator Lisa Murkowski told reporters: “I think that that will help prompt a response here in the Senate after the first of the new year, and I’m looking forward to that.”

The ACA subsidies were a major point of friction earlier this year as well, during the historic 43-day government shutdown.

Democrats had hoped to extend the subsidies during the debate over government spending, but Republican leaders refused to take up the issue until a continuing budget resolution was passed first.

WASHINGTON — Four centrist Republicans broke with Speaker Mike Johnson on Wednesday and signed onto a Democratic-led petition that will force a House vote on extending for three years an enhanced pandemic-era subsidy that lowers health insurance costs for millions of Americans.

The stunning move comes after House Republican leaders pushed ahead with a health care bill that does not address the soaring monthly premiums that millions of people will soon endure when the tax credits for those who buy insurance through the Affordable Care Act expire at year’s end.

Democrats led by Minority Leader Hakeem Jeffries of New York needed 218 signatures to force a floor vote on their bill, which would extend the subsides for three years.

Republican Reps. Brian Fitzpatrick, Robert Bresnahan and Ryan Mackenzie, all from Pennsylvania, and Mike Lawler of New York signed on Wednesday morning, pushing it to the magic number of 218. A vote on the subsidy bill could come as soon as January under House rules.

“Unfortunately, it is House leadership themselves that have forced this outcome.” Fitzpatrick said in a statement.

Origins of a Republican revolt

The revolt against GOP leadership came after days of talks centered on the health care subsidies.

Johnson, R-La., had discussed allowing more politically vulnerable GOP lawmakers a chance to vote on bills that would temporarily extend the subsidies while also adding changes such as income caps for beneficiaries. But after days of discussions, the leadership sided with the more conservative wing of the party’s conference, which has assailed the subsidies as propping up a failed marketplace through the ACA, which is widely known as “Obamacare.”

House Republicans pushed ahead Wednesday a 100-plus-page health care package without the subsidies, instead focusing on long-sought GOP proposals designed to expand insurance coverage options for small businesses and the self-employed.

Fitzpatrick and Lawler tried to add a temporary extension of the subsidies to the bill, but were denied.

“Our only request was a floor vote on this compromise, so that the American People’s voice could be heard on this issue. That request was rejected. Then, at the request of House leadership I, along with my colleagues, filed multiple amendments, and testified at length to those amendments,” Fitzpatrick said. “House leadership then decided to reject every single one of these amendments.

“As I’ve stated many times before, the only policy that is worse than a clean three-year extension without any reforms, is a policy of complete expiration without any bridge,” Fitzpatrick said.

Lawler, in a social media post, similarly said that “the failure of leadership” to permit a vote had left him with “no choice” but to sign the petition. He urged Johnson to bring the plan up for an immediate floor vote.

Path ahead is uncertain

Even if the subsidy bill were to pass the House, which is far from assured, it would face an arduous climb in the Republican-led Senate.

Republicans last week voted down a three-year extension of the subsidies and proposed an alternative that also failed. But in an encouraging sign for Democrats, four Republican senators crossed party lines to support their proposal.

Senate Majority Leader John Thune, R-S.D., argued against the Democratic extension as “an attempt to disguise the real impact of Obamacare’s spiraling health care costs.”

Freking writes for the Associated Press.

NEW YORK — For one Wisconsin couple, the loss of government-sponsored health subsidies next year means choosing a lower-quality insurance plan with a higher deductible. For a Michigan family, it means going without insurance altogether.

For a single mom in Nevada, the spiking costs mean fewer Christmas gifts this year. She is stretching her budget already while she waits to see if the Republican-led Congress will act.

Less than three weeks remain until the expiration of COVID-era enhanced tax credits that have helped millions of Americans pay their monthly fees for Affordable Care Act coverage for the last four years.

The Senate on Thursday rejected two proposals to address the problem, and an emerging healthcare package from House Republicans does not include an extension, all but guaranteeing that many Americans will see much higher insurance costs in 2026.

Here are a few of their stories.

Spending more for less

Chad Bruns comes from a family of savers. That came in handy when the 58-year-old military veteran had to leave his firefighting career early because of arm and back injuries incurred on the job.

He and his wife, Kelley, 60, both retirees, cut their own firewood to reduce their electricity costs in their home in Sawyer County, Wis. They rarely eat out and say they buy groceries only when they are on sale.

But to the extent that they have always been frugal, they will be forced to be even more so now, Bruns said. That is because their coverage under the health law enacted under former President Obama is, because of congressional inaction, getting more expensive — and for worse coverage.

This year, the Brunses were paying $2 per month for a top-tier gold-level plan with less than a $4,000 deductible. Their income was low enough to help them qualify for a lot of financial assistance.

But in 2026, that same plan is rising to an unattainable $1,600 per month, forcing them to downgrade to a bronze plan with a $15,000 deductible.

Kelley Bruns said she is concerned that if something happens to their health in the next year, they could go bankrupt. While their monthly fees are low at about $25, their new out-of-pocket maximum at $21,000 amounts to nearly half their joint income.

“We have to pray that we don’t have to have surgery or don’t have to have some medical procedure done that we’re not aware of,” she said. “It would be very devastating.”

Forgoing insurance

Dave Roof’s family of four has been on ACA insurance since the program started in 2014. Back then, the accessibility of insurance on the marketplace helped him feel comfortable taking the leap to start a small music production and performance company in his hometown of Grand Blanc, Mich. His wife, Kristin, is also self-employed as a top seller on Etsy.

Their coverage has worked for them so far, even when emergencies come up, such as an ATV accident their 21-year-old daughter had last year.

But now, with the expiration of Obamacare subsidies that kept their premiums down, the 53-year-old Roof said their $500-per-month insurance plan is jumping to at least $700 a month, along with spiking deductibles and out-of-pocket costs.

With their joint income of about $75,000 a year, that increase is not manageable, he said. So, they are planning to go without health insurance next year, paying cash for prescriptions, checkups and anything else that arises.

Roof said his family is already living cheaply and has not taken a vacation together since 2021. As it is, they do not save money or add it to their retirement accounts. So even though forgoing insurance is stressful, it is what they must do.

“The fear and anxiety that it’s going to put on my wife and I is really hard to measure,” Roof said. “But we can’t pay for what we can’t pay for.”

Single mom’s straining budget

If you ask Katelin Provost, the American middle class has gone from experiencing a squeeze to a “full suffocation.”

The 37-year-old social worker in Henderson, Nev., counts herself in that category. As a single mom, she already keeps a tight budget to cover housing, groceries and daycare for her 4-year-old daughter.

Next year, that is going to be even tougher.

The monthly fee on her plan is going up from $85 to nearly $750. She decided she is going to pay that higher cost for January and reevaluate afterward, depending on whether lawmakers extend the subsidies, which as of now appears unlikely. She hopes they will.

If Congress does not act, she will drop herself off the health insurance and keep it only for her daughter because she cannot afford the higher fee for the two of them over the long term.

The strain of one month alone is enough to have an impact.

“I’m going to have to reprioritize the next couple of months to rebalance that budget,” Provost said. “Christmas will be much smaller.”

Swenson writes for the Associated Press.

WASHINGTON — The Senate on Thursday rejected legislation to extend Affordable Care Act tax credits, essentially guaranteeing that millions of Americans will see a steep rise in costs at the beginning of the year.

Senators rejected a Democratic bill to extend the subsidies for three years and a Republican alternative that would have created new health savings accounts — an unceremonious end to a monthslong effort by Democrats to prevent the COVID-19-era subsidies from expiring on Jan. 1.

Ahead of the votes, Senate Democratic Leader Chuck Schumer of New York warned Republicans that if they did not vote to extend the tax credits, “there won’t be another chance to act,” before premiums rise for many people who buy insurance off the ACA marketplaces.

“Let’s avert a disaster,” Schumer said. “The American people are watching.”

Republicans have argued that Affordable Care Act plans are too expensive and need to be overhauled. The health savings accounts in the GOP bill would give money directly to consumers instead of to insurance companies, an idea that has been echoed by President Trump. But Democrats immediately rejected the plan, saying that the accounts wouldn’t be enough to cover costs for most consumers.

Some Republicans have pushed their colleagues to extend the credits, including Sen. Thom Tillis of North Carolina, who said they should vote for a short-term extension so they can find agreement on the issue next year. “It’s too complicated and too difficult to get done in the limited time that we have left,” Tillis said Wednesday.

But despite the bipartisan desire to continue the credits, Republicans and Democrats have never engaged in meaningful or high-level negotiations on a solution, even after a small group of centrist Democrats struck a deal with Republicans last month to end the 43-day government shutdown in exchange for a vote on extending the ACA subsidies. Most Democratic lawmakers opposed the move as many Republicans made clear that they wanted the tax credits to expire.

The deal raised hopes for bipartisan compromise on healthcare. But that quickly faded with a lack of any real bipartisan talks.

The dueling Senate votes are the latest political messaging exercise in a Congress that has operated almost entirely on partisan terms, as Republicans pushed through a massive tax and spending cuts bill this summer using budget maneuvers that eliminated the need for Democratic votes. They also tweaked Senate rules to push past a Democratic blockade of all of Trump’s nominees.

An intractable issue

The votes were also the latest failed salvo in the debate over the Affordable Care Act, President Obama’s signature law that Democrats passed along party lines in 2010 to expand access to insurance coverage.

Republicans have tried unsuccessfully since then to repeal or overhaul the law, arguing that healthcare is still too expensive. But they have struggled to find an alternative. In the meantime, Democrats have made the policy a central political issue in several elections, betting that the millions of people who buy healthcare on the government marketplaces want to keep their coverage.

“When people’s monthly payments spike next year, they’ll know it was Republicans that made it happen,” Schumer said in November, while making clear that Democrats would not seek compromise.

Even if they view it as a political win, the failed votes are a loss for Democrats who demanded an extension of the benefits as they forced a government shutdown for six weeks in October and November — and for the millions of people facing premium increases on Jan. 1.

Maine Sen. Angus King, an independent who caucuses with Democrats, said the group tried to negotiate with Republicans after the shutdown ended. But, he said, the talks became unproductive when Republicans demanded language adding new limits for abortion coverage that were a “red line” for Democrats. He said Republicans were going to “own these increases.”

A plethora of plans, but little agreement

Republicans have used the looming expiration of the subsidies to renew their longstanding criticisms of the ACA, also called Obamacare, and to try, once more, to agree on what should be done.

Thune announced earlier this week that the GOP conference had decided to vote on the bill led by Louisiana Sen. Bill Cassidy, the chairman of the Senate Health, Labor, Education and Pensions Committee, and Idaho Sen. Mike Crapo, the chairman of the Senate Finance Committee, even as several Republican senators proposed alternate ideas.

In the House, Speaker Mike Johnson (R-La.) has promised a vote next week. Republicans weighed different options in a conference meeting on Wednesday, with no apparent consensus.

Republican moderates in the House who could have competitive reelection bids next year are pushing Johnson to find a way to extend the subsidies. But more conservative members want to see the law overhauled.

Rep. Kevin Kiley (R-Rocklin) has pushed for a temporary extension, which he said could be an opening to take further steps on healthcare.

If they fail to act and healthcare costs go up, the approval rating for Congress “will get even lower,” Kiley said.

Jalonick writes for the Associated Press. AP writers Kevin Freking and Joey Cappelletti contributed to this report.