President Biden plans to announce Tuesday that his administration is making a tweak to federal rules long sought by advocates that would allow millions of additional families to buy health plans through the insurance marketplaces created under the Affordable Care Act.
The announcement will represent Biden’s latest effort to use the ACA as the main fulcrum for his goal of making health insurance more available and affordable to American consumers.
In a piece of political theater to symbolize that point, the current president will be accompanied during an afternoon Rose Garden announcement by former president Barack Obama, who was in office when the sweeping health-care law passed a dozen years ago. Obama on Tuesday will make his first return visit to the White House since he moved out in 2017 after two terms with Biden as his second-in-command.
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The tweak involves what is known in health-policy circles as the ACA’s “family glitch.” It involves who is eligible to buy health plans with federal subsidies through HealthCare.gov, the federal ACA insurance marketplace that opened in 2014, or similar marketplaces in states that operate their own.
For the most part, those marketplaces are open to U.S. residents who do not have access to health benefits through a job. However, the law also contains a provision that lets people buy ACA health plans even if they have a job that offers health benefits. They can do that if monthly premiums would require them to spend roughly 10 percent or more of their household income on that coverage.
The wrinkle has been that, in calculating how big a bite an employers’ health plan would take out of a worker’s income, the amount has taken into account only the premiums for an individual insurance policy — not a policy that covers a workers’ spouse or children, too.
Under the Obama administration, regulatory officials said those dependents were not eligible for a federal subsidy to help pay for an ACA health plan, even when family coverage through an employers’ health benefit costs far more than the law says is affordable.
During a briefing for reporters Monday evening to preview Biden’s announcement, senior administration officials said the Treasury Department, which handles ACA subsidies because they are in the form of a tax credit, is proposing a rewrite of the ACA’s rules so that the cost of job-based coverage for an entire family is taken into account.
Assuming the proposed tweak completes the federal regulatory process, the change would begin Jan. 1 next year, according to the officials, who spoke on the condition of anonymity about a change that is not yet public.
Slightly more than 5 million people nationwide are affected by the family glitch, according to estimates last year by the Kaiser Family Foundation, a health-policy research group. Most are children and women, Kaiser found.
The White House estimates that perhaps 1 million people would switch to ACA health plans if the rules change, while many others would keep their job-based health benefits, even if they cost more. And an estimated 200,000 uninsured people would gain coverage, the administration officials said.
Larry Levitt, Kaiser’s executive vice president for health policy, said, “Fixing the family glitch is the single most significant step the Biden administration can take to improve affordability under the ACA without Congress. And Congress has not exactly been moving with lightning speed lately.”
Levitt noted that other parts of Biden’s health-care agenda have stalled on Capitol Hill. Congressional Democrats, who hold slender majorities in the House and Senate, have not amassed enough votes even within their own party to pass broad social policy legislation known by Biden and other proponents as the Build Back Better Act.
Part of that legislation would make marketplace health plans available at little or no cost for low-income people in a dozen states that have not expanded Medicaid under the ACA. The stalled legislation would also try to ease the nation’s expenses for prescription drugs by allowing Medicare, the federal insurance system for older Americans, to negotiate prices directly with drug manufacturers.
In the absence of such legislative accomplishments, Biden is striving to draw attention to changes he can make through his own powers. He also plans Tuesday to issue an executive order that will be a sequel to one he signed when he came into office that directed federal agencies to do what they could to strengthen Medicaid and the ACA.
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Under the new order, administration officials said, Biden will direct agencies to “continue doing everything in their power to expand affordable quality, affordable health coverage.” The order does not spell out specific steps. But it says in broad strokes that the government should help people get and keep coverage, understand their insurance choices and connect with health services when they need them.
The announcement will represent Biden’s latest effort to use the ACA as the main fulcrum for his goal of making health insurance more available and affordable to American consumers.
In a piece of political theater to symbolize that point, the current president will be accompanied during an afternoon Rose Garden announcement by former president Barack Obama, who was in office when the sweeping health-care law passed a dozen years ago. Obama on Tuesday will make his first return visit to the White House since he moved out in 2017 after two terms with Biden as his second-in-command.
ADVERTISING
The tweak involves what is known in health-policy circles as the ACA’s “family glitch.” It involves who is eligible to buy health plans with federal subsidies through HealthCare.gov, the federal ACA insurance marketplace that opened in 2014, or similar marketplaces in states that operate their own.
For the most part, those marketplaces are open to U.S. residents who do not have access to health benefits through a job. However, the law also contains a provision that lets people buy ACA health plans even if they have a job that offers health benefits. They can do that if monthly premiums would require them to spend roughly 10 percent or more of their household income on that coverage.
The wrinkle has been that, in calculating how big a bite an employers’ health plan would take out of a worker’s income, the amount has taken into account only the premiums for an individual insurance policy — not a policy that covers a workers’ spouse or children, too.
Under the Obama administration, regulatory officials said those dependents were not eligible for a federal subsidy to help pay for an ACA health plan, even when family coverage through an employers’ health benefit costs far more than the law says is affordable.
During a briefing for reporters Monday evening to preview Biden’s announcement, senior administration officials said the Treasury Department, which handles ACA subsidies because they are in the form of a tax credit, is proposing a rewrite of the ACA’s rules so that the cost of job-based coverage for an entire family is taken into account.
Assuming the proposed tweak completes the federal regulatory process, the change would begin Jan. 1 next year, according to the officials, who spoke on the condition of anonymity about a change that is not yet public.
Slightly more than 5 million people nationwide are affected by the family glitch, according to estimates last year by the Kaiser Family Foundation, a health-policy research group. Most are children and women, Kaiser found.
The White House estimates that perhaps 1 million people would switch to ACA health plans if the rules change, while many others would keep their job-based health benefits, even if they cost more. And an estimated 200,000 uninsured people would gain coverage, the administration officials said.
Larry Levitt, Kaiser’s executive vice president for health policy, said, “Fixing the family glitch is the single most significant step the Biden administration can take to improve affordability under the ACA without Congress. And Congress has not exactly been moving with lightning speed lately.”
Levitt noted that other parts of Biden’s health-care agenda have stalled on Capitol Hill. Congressional Democrats, who hold slender majorities in the House and Senate, have not amassed enough votes even within their own party to pass broad social policy legislation known by Biden and other proponents as the Build Back Better Act.
Part of that legislation would make marketplace health plans available at little or no cost for low-income people in a dozen states that have not expanded Medicaid under the ACA. The stalled legislation would also try to ease the nation’s expenses for prescription drugs by allowing Medicare, the federal insurance system for older Americans, to negotiate prices directly with drug manufacturers.
In the absence of such legislative accomplishments, Biden is striving to draw attention to changes he can make through his own powers. He also plans Tuesday to issue an executive order that will be a sequel to one he signed when he came into office that directed federal agencies to do what they could to strengthen Medicaid and the ACA.
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Under the new order, administration officials said, Biden will direct agencies to “continue doing everything in their power to expand affordable quality, affordable health coverage.” The order does not spell out specific steps. But it says in broad strokes that the government should help people get and keep coverage, understand their insurance choices and connect with health services when they need them.
