The US Senate on Thursday rejected competing proposals to address the imminent expiration of subsidies for Affordable Care Act health insurance plans, greatly increasing the chances that healthcare costs will soon rise to unaffordable levels for millions of Americans.
The votes, part of a deal brokered between Republican majority leader John Thune and the Democratic senators who agreed to reopen the government after a historically long shutdown last month, came as premium tax credits for an estimated 21.8 million enrollees of the plans are set to expire at the end of the month. Health policy research group KFF estimates that annual premiums will more than double if the subsidies are allowed to expire.
A Democratic-backed bill to extend them for three years failed to clear the Senate’s 60-vote threshold to advance, with 51 votes in favor and 48 against. Four Republicans – Josh Hawley of Missouri, Susan Collins of Maine and Lisa Murkowski and Dan Sullivan of Alaska – supported it, along with all Democrats. Montana Republican Steve Daines did not vote.
A Republican proposal for the government to make payments into health savings accounts (HSAs) for enrollees of Obamacare, as the law is commonly known, in lieu of the tax credits, was also voted down. All Republicans except Rand Paul of Kentucky voted in support of it, and Daines did not vote.
Leaders from both parties blasted the other’s proposals ahead of the vote, with Thune accusing Democrats of trying to pump money into propping up the Affordable Care Act, which most lawmakers in his party have opposed since its creation in 2010.
“Apparently they think that a three-year extension with no reforms, to try and disguise the real impact of Obamacare’s spiraling costs, is actually a plan,” the majority leader said before the vote.
Democrats countered by accusing Republicans of not being serious about their promise to lower the cost of living in the United States. The issue was at the heart of the 2024 presidential campaign, and has been linked to Donald Trump’s recent decline in public approval, as voters increasingly say he has not done enough to make life more affordable.
“Senate Republicans just shoved the American people off the side of a cliff with no parachute and with an anchor tied to their feet,” Senate minority leader Chuck Schumer said after the vote. “Republicans now own America’s healthcare crisis.”
The premium tax credits were first created under Joe Biden in the wake of the Covid-19 pandemic. While Trump toyed with the idea of extending the credits, he appeared to shut the door on it in an interview with Politico published Tuesday, while supporting the GOP proposal. “I want to give the money to the people, not to the insurance companies,” he said.
The measure introduced by Republican senators Bill Cassidy and Mike Crapo is built around government payments of $1,000 into the HSAs of people enrolled in bronze or catastrophic exchange plans, which typically have high deductibles. People from the ages of 50 to 64 would get another $500, and there would be limits for all who received the funds on using it to pay for abortions or gender-affirming care.
Bernie Sanders, the independent senator who is the ranking member on the Senate health committee, said the Crapo-Cassidy bill “would make an already broken and outrageously expensive healthcare system even worse” and would encourage people to switch to plans with unaffordable deductibles in exchange for payments into their HSAs.
“It would do nothing to prevent premiums from doubling, tripling or even quadrupling for millions of Americans. It would do nothing to lower the outrageous cost of healthcare or prescription drugs. It would do nothing to make it easier for Americans to see a doctor when they get sick,” said the senator, who caucuses with the Democrats.
Trump presided over an unsuccessful attempt to repeal Obamacare in his first term, but the law today is relatively popular, with a Gallup poll released this week finding 57% of voters approve of it. Republicans have not made any serious attempts at its repeal since Trump began his second term in January.
Any legislation passed by the Senate would need to win the approval of the Republican-controlled House, where speaker Mike Johnson opposes the tax credits.
At a Wednesday press conference, he said that the House GOP planned to soon unveil its own bills to make healthcare more affordable, without giving details.
“The overall system is broken, and we’re the ones that are going to fix it. You will see that laid out,” he said.
A bipartisan group of moderate House lawmakers also introduced a proposal in the House this week that would extend the premium tax credits through 2027, while imposing new caps on the income of enrollees and protections against fraud.
