House panel advances bill to boost ACA subsidies as part of COVID-19 relief package

A House panel has advanced legislation to expand the eligibility for Affordable Care Act (ACA) exchange plan subsidies, taking another step toward final passage.

The House Ways and Means Committee voted 24-18 along party lines Thursday to approve a section of a $1.9 trillion COVID-19 relief package that includes the subsidy boost. The legislation now moves to the House Budget Committee, which will roll it into the final package and send to the House floor.

The bill would require that any household with income 400% above the federal poverty level and higher pay only 8.5% of their income on healthcare costs.

Currently, any consumer that makes more than 400% is not eligible to get any of the income-based tax credits that lower the cost of an ACA exchange plan.

The legislation also makes it easier for low-income people to afford their plans. Those making 150% above the poverty level can now get fully subsidized coverage, a major change from current law that requires them to pay 4.3% of income on healthcare costs.

The changes to the tax credits will only be in effect through 2022.

The legislation also wants to boost premium assistance to cover 85% of the costs for continuous coverage under COBRA for any eligible individuals and families through the end of September.

This is only one part of the legislative package. The House Energy and Commerce Committee released legislation aimed at expanding Medicaid coverage and eligibility.

Congressional Democrats are using a parliamentary procedure called reconciliation to move the entire $1.9 trillion package through Congress. Reconciliation ensures that a bill can get through the Senate via a simple majority and means Democrats don’t need to get 60 votes to break a legislative filibuster.

But a reconciliation bill can only focus on certain budgetary and spending items, which can limit the actions any legislation can take.