August 12, 2022

Preserving affordable health care coverage for millions

Congress should act to make COVID-19 policies permanent and ensure millions of people can keep their affordable health care coverage beyond 2025.

By Anthony A. Barrueta, Senior Vice President, Government Relations

Millions of Americans are benefiting from expanded health coverage and financial assistance programs that were enacted earlier in the COVID-19 pandemic. The Inflation Reduction Act of 2022 ensures that affordable health care coverage will continue for millions of people by extending expanded Affordable Care Act subsidies through 2025.

These programs will continue to make health care and coverage more available and affordable for more people for the next 3 years. This represents progress, and we at Kaiser Permanente are supportive of this crucial legislation. At the same time, in 3 years these expanded health coverage and financial assistance programs will once again be at risk.

Expanded subsidies have worked — and Congress should continue the work of making them a permanent structural element of our overall health system.

Millions gained coverage and access

During the most critical health care crisis in more than a century, the Affordable Care Act demonstrated it is a foundation that can be built upon to help meet the needs of Americans in times of uncertainty.

The economic impact of the pandemic has left individuals, families, and communities stretched to do more with their existing resources. To ensure low- and middle-income families wouldn’t have to worry about their ability to afford or access health care, Congress temporarily expanded who was eligible for ACA subsidies to buy health insurance. Congress also enhanced subsidies for lower-income people who were already eligible.

That these expanded subsidies have been effective is undeniable. Enrollment in health insurance through government-run marketplaces reached an all-time high of 14.5 million people nationwide. As premiums became more affordable, millions more Americans had access to $0 premium plans and low-cost plans with premiums of less than $50 per month.

The lowest-income marketplace enrollees, with incomes between 1 and 1.5 times the federal poverty level, represent 42% of the marketplace and currently pay nothing or next to nothing for their monthly premiums. Before the extended subsidies, they paid significantly more of their limited income for coverage.

There are also an estimated 3.7 million middle-income individuals and families (with incomes between 4 and 6 times the poverty level) who newly gained access to subsidies. These are people who don’t have access to employer-sponsored health insurance. They may be self-employed, have flexible or freelance jobs, or have retired before becoming eligible for Medicare.

These gains mark significant progress. If subsidies end, millions of people will face higher premium payments and could lose their coverage completely due to a lack of affordable options. The Inflation Reduction Act of 2022 provides another important temporary fix, but Congress should not wait until the new expiration date approaches before considering how to make them permanent.

Changing coverage policies will impact access to care

People who are benefiting from expanded subsidies aren’t the only ones facing uncertainty as policies enacted during the COVID-19 pandemic evolve.

Currently there is a policy that prohibits states from disenrolling people from Medicaid during the COVID-19 public health emergency. This policy protects millions of people with low incomes by allowing them to keep their health coverage and get needed care during the pandemic. When this policy ends, many people could lose their coverage.

Some of this population will continue to be eligible for Medicaid. Others will find themselves no longer eligible and will need to buy subsidized health coverage from government-run marketplaces.

The entire U.S. health care system benefits the closer we get to universal coverage. That’s why we can’t take these gains for granted.

This transition will be complex. The extension of enhanced marketplace subsidies will be extremely important, because without them people who must transition from Medicaid to marketplace coverage would otherwise face much larger cost increases.

Maintaining affordable coverage through 2025 and beyond

The Inflation Reduction Act represents critical action to ensure that affordable health care coverage will continue for millions of Americans. It includes important provisions, and Kaiser Permanente is greatly encouraged by the progress made with this legislation.

Expanded subsidies introduced in response to the COVID-19 pandemic have proven effective in expanding enrollment and providing health coverage and care to millions of Americans. This in turn has strengthened our entire health care system. With record numbers of people covered, our elected officials can continue working to address the affordability of care for everyone, helping to make our communities healthier.

Nonetheless, there are still gaps in coverage that remain to be addressed. We have a key opportunity to continue to build on the public-private framework established by the ACA to meet the needs of the American people.

The entire U.S. health care system benefits the closer we get to universal coverage. That’s why we can’t take these gains for granted. Our country can learn from these successes and continue to build upon the ACA and the progress we’ve made by making these improvements permanent.