BLOG — Enhanced ACA Subsidies Provide Respite in Sea of Rising Prices

During a time of record inflation, extending enhanced ACA subsidies will spare American consumers one more rising cost.

By Alliance of Community Health Plan CEO and President Ceci Connolly

Across the country, families are struggling to pay bills. From gas to groceries, the cost of everyday expenses has skyrocketed—putting additional burdens on Americans still recovering from a prolonged pandemic.

But thanks to temporary subsidy enhancements approved by Congress during the COVID-19 crisis, monthly costs for health coverage through the individual market have dropped for an overwhelming majority of enrollees. The subsidies have reduced the ranks of uninsured in the nation and freed up money for other essential costs, such as food, housing and fuel.

The enhanced premium subsidies work, pure and simple, but the legislation authorizing them is about to expire—threatening Americans’ access to affordable, high-quality coverage and care. Adding to the urgency, letters will start arriving in mailboxes this October, informing enrollees of a big jump in premiums.

If lawmakers don’t act quickly to extend federal relief, costs will jump, forcing Americans out of coverage and adding further strain on family budgets. More than 13 million Americans could be impacted, and a quarter of those could lose coverage altogether.

According to the Kaiser Family Foundation, 2022 premiums would have been 53 percent higher on average without the enhanced subsidies. These lowered costs allowed 14.5 million Americans to enroll in high-quality, affordable coverage for the first time, shattering previous enrollment records.

ACHP member companies have seen the impact firsthand: Priority Health President and CEO Praveen Thadani recently noted that 14 percent more Michiganders have access to care thanks to federal relief. And UPMC’s Kimberly Orth noted in a recent op-ed, nearly 90 percent of Pennsylvanians enrolled during the 2022 open enrollment received an average financial savings of $500 a month.

Congress can fix this. Lawmakers are inching toward a sprawling deal that will lower drug costs for consumers and—importantly—provide the federal government with billions in savings. By using those savings to pay for enhanced subsidies, Congress could strike two critical victories: lowering drug prices and maintaining affordable coverage on the individual exchange.

Every day that lawmakers don’t act, Americans on the exchanges come one step closer to losing access to the coverage and care they deserve. Failing to extend enhanced subsidies will disproportionately impact Black Americans, younger enrollees and low-income individuals—exactly the populations we’re trying to protect.

Extending ACA subsidies should be a top priority. Lawmakers must continue the critical work of keeping Americans insured.