Under president-elect Joe Biden, we will likely see an expansion of the Affordable Care Act depending on a few key events. For one, how will the Supreme Court rule on the current challenge to the ACA? Secondly, will the Democrats control the Senate after the runoff election in Georgia? If the Supreme Court allows reconfirms the constitutionality of the Affordable Care Act and Congress is held by the Democrats, we should see further expansion of the ACA. Even with a Republican-led Senate, it is still likely that we will see an expansion of the ACA unless the Supreme Court states that the individual mandate is inseverable from the ACA.
Expanding Health Insurance Subsidies to more of the Middle Class
Biden has stated that he wants to expand the federal premium tax credits to more Americans that earn above 400% of the Federal Poverty Level which is the current cutoff for premium assistance. In California, state tax credits are already available for those earning between 400-600% of the Federal Poverty Level or FPL. More Americans receiving subsidized health insurance would help alleviate the lack of affordability for much of the middle class who find it challenging to pay the full price of their health insurance. Furthermore, Biden has considered using a new methodology of calculating premium assistance. Instead of calculating subsidized health insurance based on the affordability of the 2nd most affordable Silver plan, Biden has mentioned calculating premium assistance based on the price of a Gold metal plan, likely to increase premium assistance for many Americans.
Reverse cuts to Healthcare.gov
Under President Trump, we have seen a 90% cut to the budget of the Healthcare.gov website. Although most Californians apply through Covered CA, many other states do not have a state-funded exchange to purchase health insurance from so may Americans rely on Healthcare.gov. Under a Biden administration, it is very likely budget cuts to Healthcare.gov will be reversed and we will see more federal advertising encouraging Americans to get comprehensive health insurance.
Curb Growth of Alternatives to the Affordable Care Act with a Public Option
Under President Trump, short-term medical insurance has expanded dramatically with members now allowed to have these bare-bones plans for as long as 364 days, 274 days longer than the previously allowed 90-day policy period (Short-term medical plans have been banned in California since 2019 due to SB-910). Furthermore, we now have over one million Americans enrolled in religious health ministry plans which are not compliant with the Affordable Care Act, a massive jump up from as few as 160,000 members back in 2014. A major concern with religious health ministry plans is that they have no legal obligation to pay for any medical services as they are not actually health insurance plans but instead religious cost-sharing plans. These plans also may not be reinsured and are not required to be solvent. It is not clear what laws Biden will introduce to curb these plans although he has mentioned offering a public health insurance option that will pay providers at rates similar to Medicare, likely providing more affordable health insurance options, limiting the demand for short-term medical and religious health ministry plans.
Overall, we will all have to wait and see what happens under President Biden’s term which starts on Wednesday, January 20th, 2021. The Senate runoffs in Georgia and the Supreme Court ruling on the severability of the individual mandate from the Affordable Care Act will be major indicators of how much a Biden administration can do to expand on the Affordable Care Act.
We will keep our clients up-to-date on any changes to the state and federal healthcare legislation. At Solid Health Insurance Services, we strive to help our clients find affordable health, dental, vision, life and long-term care insurance which best meets both their budget and medical needs. Please contact us at 310-909-6135 or at info@solidhealthinsurance.com for further assistance.