Maybe they’re going to call this Medicare Part E?
Americans ages 50 to 64 cannot claim free or near-free health insurance courtesy of American taxpayers. At least not yet.
But we may be heading in that direction.
The new $740 billion inflation cut bill, scheduled to be signed into law by President Biden this week, extends favorable health insurance subsidies for another three years, especially benefiting people over the age of 50 who are still too young for Medicare. . in 65).
The supposed one-time subsidy, first enacted in the March 2021 $1.9 trillion American Rescue Plan Act, will cost taxpayers an estimated $21 billion annually. It will be. Many of them are aimed at people earning between 100% and 400% of the federal poverty level to keep health insurance affordable. But it also includes subsidies for those earning more than 400% of his FPL, in the form of premium tax credits. This equates to an annual income of $111,000 for a family of four.
This subsidy helps those whose Obamacare premiums exceed 8.5% of their annual income. Analysts say this is especially important for older Americans, who generally pay much higher health insurance premiums as their actual medical costs increase as they age.
“These subsidies are particularly important for people aged 50 to 64 who pay up to three times their premiums,” AARP said in a statement, praising the passage of the bill.
Without the new legislation, those currently benefiting from subsidies would have faced a steep rise in health insurance premiums.
Without the new law, people aged 50 to 64 “are most at risk of significantly higher exchange rate premiums, which could make health insurance unavailable for many,” according to an analysis by health insurance consultancy Avarere. ” warns.
Avalere calculates that people in their 50s or early 60s who earn between 400% and 500% of the federal poverty level could save $4,700 in premiums as a result of the subsidy. Even for someone in that age group earning 100% to 150% of the federal poverty level, the company estimates the savings average about $500 per person.
The Kaiser Family Foundation, a leading healthcare think tank, reports:
“Without subsidies, health insurance premiums for a 60-year-old now average over $11,000 a year. more than half of the cost of insurance.Without ARPA, premiums would increase by 165%.”
Once these subsidies have been in place for five years, Congress may be more inclined to keep extending the subsidies, which may eventually become permanent. And with a federal budget this big ($6 trillion in annual spending, $1.4 trillion in deficit), $20 billion is petty cash.
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