Are you one of the millions of Americans who lost employer-sponsored health insurance in 2020? Or one of the millions more who has been unable to afford it?
Then you’ll want to pay attention to the fate of President Joe Biden’s “American Rescue Plan.”
Biden’s pandemic emergency relief package includes two proposals to make health coverage more accessible for those who have been hit hard by the pandemic:
- The government would cover the monthly costs of Consolidated Omnibus Budget Reconciliation Act (COBRA) through September 30, 2021. (COBRA allows workers and their dependents to continue receiving health coverage after a job-related change. Examples include reduced work hours, divorce, or job loss.
- The Affordable Care Act (ACA) tax credit value would be expanded to lower or eliminate the amount you pay for your health insurance every month. This change would ensure you wouldn’t pay more than 8.5% of your gross income (the amount you earn before taxes and other deductions are taken out) every year. The current cap is 9.8%.
“Together, these policies would reduce premiums for more than 10 million people and reduce the ranks of the uninsured by millions more,” a fact sheet says.
According to blogger Charles Gaba, the reduced cap of 8.5% could save a single adult between $1,000 to $6,500 annually, depending on their age and location. (Gaba has been tracking ACA enrollments since the health insurance exchanges launched in 2013.)
Savings for couples and families with children could be even more dramatic. For example, a 40-year-old married couple with two kids living in Henrico County, Virginia, could save $10,000 per year. Meanwhile, a 60-year-old couple in the same county could save nearly $20,000 annually.
However, at an estimated cost of $1.9 trillion, Biden’s rescue plan faces steep opposition. So we’ll have to wait and see if this “rescue plan” comes through.