The bill, introduced this week by House Ways and Means Committee chair Rep. Richard Neal, would make the federal premium subsidy more generous and would eliminate the maximum income cap.
Enrollees would pay no more than 8.5% of their income towards coverage, down from nearly 10% now. Also, those earning more than the current cap of 400% of the federal poverty level — about $51,000 for an individual and $104,800 for a family of four in 2021 — would become eligible for help.
In addition, the legislation would bolster subsidies for lower-income enrollees, eliminating their premiums completely. And it would create subsidies for unemployed workers who are ineligible to continue their job-based coverage through COBRA.
The premium subsidy enhancements are aimed at making coverage more affordable to more consumers, with the goal of convincing more uninsured Americans to sign up for policies.
“We know that people want health insurance. It’s the struggle to pay for it that’s the barrier,” said Sabrina Corlette, co-director of the Center on Health Insurance Reforms at Georgetown University. The legislation would “make a big difference for a lot of people.”
However, the proposal will not help the lowest-income people living in the 12 states that have yet to expand Medicaid. In these states, those who earn less than the poverty level — $12,760 for an individual and $26,200 for a family of four — are not eligible for federal subsidies on the exchanges.