https://www.axios.com/pro/health-care-policy/2024/08/14/aca-subsidies-fate-depends-on-election

The fate of billions of dollars of Affordable Care Act subsidies is riding on the election, which will also determine how much the next Congress will be consumed with relitigating the law.

Why it matters: 

Enhanced ACA subsidies expire at the end of 2025 without congressional action. They’ve substantially lowered consumers’ premiums and driven more enrollment in marketplace plans, though at a hefty cost to the government.

Driving the news: 

Although the fight over repealing the ACA itself has faded, the partisan battle is shifting to the fate of the enhanced subsidies, passed as part of the American Rescue Plan Act and then extended via the Inflation Reduction Act.

• If Republicans win both chambers of Congress and the presidency, they’re strongly expected to let the subsidies expire.
• But if Democrats win the presidency or even partial control of Congress, there’s a good chance for a prolonged debate and, possibly, a grand bargain to extend them.
• Sen. Bill Cassidy, the top Republican on the HELP Committee, tied the fate of the subsidies to the election results when asked what’s ahead.
• “Tell me, do Republicans have everything, do Democrats have everything, or is it divided government?” he told Axios.

By the numbers: 

The enhanced subsidies have cut premium costs an average of 44%, or $705 per year, for qualified ACA enrollees, according to a KFF analysis.

• “If they expire, the uninsured rate would jump and people would see huge premium increases,” said Larry Levitt, KFF’s executive vice president for health policy.
• The CBO finds that extending them would raise the deficit by $335 billion over 10 years and increase the number of people with health coverage by 3.4 million.
• Some Republicans are portraying the continuation of subsidies as a sop to health insurers.
• “At a time when we are experiencing a record $35 trillion national debt … it is unconscionable that Democrats would continue to push for massive taxpayer-funded handouts to the wealthy and large health insurance companies,” House Budget Chair Jodey Arrington and Ways and Means Chair Jason Smith said in a joint statement responding to the CBO estimate.

What they’re saying: 

“I think just not doing the enhanced subsidies, I would take that as a win for 2025,” said Brian Blase, a former Trump administration health adviser now president of Paragon Health Institute.

• He pointed to the cost, also arguing that enhanced subsidies incentivize fraud, with ineligible people enrolling in zero-premium plans. “They’re associated with an unprecedented level of fraud,” he said.

• “It’s entirely possible that some people are fraudulently misestimating their income,” Levitt said. But, he noted, many low-income people simply lead “volatile lives” and don’t always know what their income will be in a coming year.

What’s next: 

Senate Finance Chair Ron Wyden told Axios he wants to combine an extension of the enhanced subsidies with a bill he’s sponsored that would crack down on unscrupulous insurance brokers, to help counter GOP arguments about fraud.

• “I think it would be a real good package to crack down on these insurance scams and these brokers ripping off the ACA and focus on something that actually helps people, which is the premium [tax credits],” Wyden said.
• The expiration of some of the 2017 Trump tax cuts next year also could provide an opening for a deal with Republicans to extend the ACA subsidies in divided government.

The bottom line: 

Levitt said that although some of the repeal fervor has faded, “the future of the program, the future success of the program, very much depends on these enhanced subsidies.”