(NEXSTAR) – One of the sticking points at the heart of the government funding fight is a debate over tax credits tied to the Affordable Care Act that expire January 1.
Starting next year, people who receive health care coverage through the Affordable Care Act marketplace face higher out-of-pocket costs. Democrats argue it’s an urgent issue.
“People are already getting letters in the mail saying their premiums are about to go up next year,” Senate Minority Leader Chuck Schumer (D-New York) said on the Senate floor Friday. “$300, $400, $500. God forbid, even more.”
The enhanced ACA tax credits were passed in 2021. The credit is based on household income and was extended to patients whose incomes are more than 400% above the federal poverty limit. As of 2025, that includes individuals making more than $62,600 annually or a family of four earning $128,600 per year. The law also increased the tax credit.
The health nonprofit KFF estimates that out-of-pocket premium payments will increase by more than 75% on average.
“Obamacare prices, if you’re on the marketplace, are going to skyrocket this November,” said Sen. Elissa Slotkin (D-Michigan). “I’m not going to just lay down and take that.”
Slotkin said she worries more Americans will not have health care coverage.
“They’re not going to buy it,” she said. “They’re going to go without and they’re just going to cross their fingers and hope that they don’t have a catastrophic accident or heart attack.”
Democrats want an extension of the tax credits tied to a short-term government spending bill. But Republicans argue now isn’t the time to address the issue.
“I’m concerned about it, but there’s some problems with the program,” said Sen. Shelley Moore Capito (R-West Virginia). “The reason we’re not going to put it on the seven-week continuing resolution is because it’s over $300 or close to $400 billion.
Capito, the No. 4 Republican in the Senate, said she believes that’s why lawmakers shouldn’t rush on this.
“We’re making sure that we do it the right way, that we keep the coverage for the folks who need it the most and that any kind of waste or fraud that’s in these programs is eliminated at the same time,” she said.
For now, Senate Republican leaders haven’t ruled out taking action on the subsidies later this year.
“We are open to the conversation about what we do with the Obamacare premium tax credits,” Senate Majority Leader John Thune told reporters Friday afternoon. “That’s something in which members, Republican senators and I think for that matter, Republican House members, have an interest as well. But this isn’t the place to do that.”
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