Senators will vote on an extension of enhanced subsidies next week, as Republicans search for a market-based solution to skyrocketing costs.
Democrats will get a Senate vote next week on their plan to extend the expiring enhanced subsidies for the Affordable Care Act, but the larger question of reducing the rising cost of health care may have to wait.
Both parties agree that the U.S. health care system is unreasonably expensive, but they are far from agreement on how to reduce costs rather than merely subsidize prices. For now, both Republicans and Democrats appear focused on the immediate problem of keeping health insurance affordable for the 24 million people who buy it through the Affordable Care Act exchange. The Affordable Care Act is former President Barack Obama’s health care law, known as Obamacare.
Here is what is happening now.
Republicans Ready for Deal on Enhanced Subsidies
Republicans had mostly resisted extending the enhanced subsidies, which Democrats created in 2021 as a response to the COVID-19 pandemic, then set to expire at the end of 2025.
Democrats now want to make the tax credits permanent. They argue that, without help from the federal government, millions of people will lose their health coverage because they simply can’t afford it.
Even those who get insurance through their employer benefit from government subsidies on health insurance premiums, Rep. Brad Schneider (D-Ill.) told reporters on Dec. 3.
“Whether you work for a company and get your insurance through your employer, the employer may pay a part or even bulk of that, and they take a [tax] deduction,“ Schneider said. ”They get support and a subsidy from the government.”
Republicans have chafed at the enhanced subsidies for years, arguing that they have caused health care inflation by funneling billions of dollars directly into insurance companies rather than to health care providers or patients.
Some in the GOP have hinted that they are open to a compromise on extending the enhanced subsidies as part of a larger effort to reform health care spending.
President Donald Trump said on Nov. 25 that he did not favor extending the enhanced subsidies but conceded, “Some kind of extension may be necessary to get something else done.”
