President Joe Biden announced that more families would become eligible for subsidized health plans under Obamacare starting next year.
Through a Treasury Department rule, the administration will close the “family glitch” in the Affordable Care Act, also known as Obamacare. Under current law, a single person can get an affordable health plan capped at 10% of their income, but that lower rate is not extended to family members who are included in their relative’s plan. Because the law does not consider the increase in premiums for adding dependents to the policy, the cost of coverage for family members can far exceed the 10% threshold.
“It’s a common issue facing 5 million Americans who can’t get financial help to get coverage under the Affordable Care Act,” Biden said. “We’re going to change that. Once today’s proposed rule is finalized, starting next year, working families in America will get the help they need to afford full family coverage for everyone in the family.”
Biden announced the proposal at the White House alongside former President Barack Obama, the law’s biggest champion, and Vice President Kamala Harris. The long-sought regulatory change was lauded by healthcare industry groups.
“With the announcement today, the Biden Administration has taken a crucial step in the campaign to cover the 5 million uninsured people who fall into the family glitch,” said American Medical Association President Gerald Harmon. “The family glitch is inconsistent with the goals of the Affordable Care Act and unfairly penalizes family members of lower-income workers.”
The White House projected that Tuesday’s rule change will give 200,000 uninsured people coverage and nearly 1 million Americans would see their premiums go down.
Biden maintained his objective is to build on the existing healthcare law, which was criticized during the 2020 presidential campaign by liberals in favor of a universal “Medicare for all” healthcare program.
He also signed an executive order that directs federal agencies to continue searching for ways to make health coverage more affordable. Some of the objectives of the executive order include “helping people better understand their coverage options and to be able to pick the best option for that family; taking steps to strengthen benefits, lower costs and expand eligibility; protecting Americans from low-quality coverage that can lead to a mountain of medical debt,” according to Biden.
The Biden administration celebrated 14.5 million new enrollments in Obamacare plans for 2022, which the Department of Health and Human Services attributed to new subsidies passed as part of the $1.9 trillion American Rescue Plan enacted last year as well as concerns about affording healthcare during the pandemic.
The temporary subsidies for coverage passed with the American Rescue Plan are set to expire at the end of this year, putting millions of people’s coverage at risk. A lack of congressional action to extend those subsidies before the year’s end could further imperil Democrats’ tenuous hold on the legislature.