The American Rescue Plan
With the signing of the most recent COVID-19 Relief Bill, more people may be able to afford healthcare coverage through the federal and state health insurance marketplaces. The American Rescue Plan (ARP) will help to save millions of people hundreds of dollars in healthcare insurance costs. Those who qualify include those who are current or new “Obamacare” beneficiaries, self-employed people who purchase their own insurance (without federal help), laid-off workers struggling to retain employer coverage and almost all persons collecting unemployment benefits.
ARP and ACA
The Affordable Care Act (ACA) will see historic expansions that will dramatically improve marketplace access and affordability. Some of these changes include:
- Changing the formulas for health insurance tax credits that allow a wider number of individuals to qualify and make them more generous for most. Those who are collecting unemployment benefits would qualify for the most generous tax credits along with reductions in copays and deductibles.
- People currently covered under COBRA are also seeing benefits from the newly signed ARP. The American Rescue Plan makes COBRA coverage more affordable by subsidizing (on the individual’s behalf) 100% of the COBRA premiums beginning the first month after ARP enactment until September 30, 2021.
- Preventingtaxpayers who may have misestimated their income in 2020 from having to repay excess premium tax credits at tax time.
- Provides $20 million for marketplace modernization to help state-based marketplaces update their systems
There is an expectation that Congress will make these changes permanent in future legislation, so for now, these are temporary changes included in the broader response to the COVID-19 crisis. Currently, subsidy enhancements will be in place for only two years while the claw back protection and link to unemployment will be in place only for one year.
More details about how the American Rescue Plan affects healthcare can be found here: https://www.healthaffairs.org/do/10.1377/hblog20210311.725837/full/
**Emergency enrollment period for the Affordable Care Act began February 15, 2021 and ends May 15, 2021. Persons interested in signing up should visit HealthCare.gov.
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