WASHINGTON – Some consumers will find it quick and easy to take advantage of generous health insurance subsidies in the new COVID relief package, but others face extra paperwork and a wait, federal officials said Friday.
The $1.9 trillion legislation signed by President Joe Biden on Thursday includes among its dozens of provisions the biggest expansion of health insurance tax credits under the Affordable Care Act in a decade. It cements the place of the Obama-era law among government health insurance programs, after four years of fruitless efforts by former President Donald Trump to overturn it.
Biden's “Obamacare” expansion reduces costs for new customers, for those already enrolled in the program, for people who experience unemployment this year, and it may also help many whose incomes were too high to previously qualify for subsidies.
But it affects people in each of those groups in a different way, according to a summary released by the Centers for Medicare and Medicaid Services, or CMS. Here's a quick overview:
— Starting April 1, people who sign up at HealthCare.gov under a special enrollment period Biden opened up will automatically get the benefit of the higher subsidies authorized by Congress. The extra taxpayer-provided assistance reduces net costs by an average of $50 per person per month, CMS said. Think of it as a discount. The special sign-up period ends May 15.
— More than 9 million already enrolled and receiving subsidies for their private health insurance plans also stand to benefit from the boost in aid. But they will have to go back to HealthCare.gov after Apr. 1 to get their discounts. Or they could wait until tax time next year to claim the richer tax credit owed them under the legislation. A CMS official said the agency is working to see if it can automatically provide current customers with their savings later this year.
— People who experience a spell of unemployment this year are entitled to enroll in a standard HealthCare.gov plan at no cost to them. But officials said figuring out how to connect the health insurance program with unemployment assistance databases is going to take time. Nonetheless, CMS is urging unemployed people to enroll for health care now. They would be able to claim their full subsidies later.
— People who previously made too much to get financial help under the “Obamacare” limits have some math to do. Congress not only increased the amount of aid, but changed the income formula so more people in the solid middle class can qualify. However, they'll have to have a health plan that meets the standards in the Obama health law. That means many may have to switch coverage.
“Changing anything in the health care system takes a lot of time and a lot of effort,” said industry analyst Chris Sloan of the consulting firm Avalere Health.
It's disappointing that existing customers will have to take extra steps to claim their enhanced subsidies, he added.
“The goal is to stabilize coverage today in the middle of a pandemic, not provide a tax benefit in 2022,” said Sloan, who said he hopes techies at CMS and their health insurance counterparts find a way to automatically provide the savings in coming months.
HealthCare.gov serves 36 states, while others run their own health insurance markets. So different timetables are possible for the rollout of the new benefits.
Despite all the potential complexities, supporters of the Affordable Care Act say it's notable that the government will start providing consumers the benefits of Biden's expansion only a few weeks after the president signed the bill.
“I think its great that they are going to be able to implement it for people newly coming in as of Apr. 1,” said Judy Solomon of the Center on Budget and Policy Priorities, which advocates on behalf of low-income people.