Malliotakis Says ACA Plan With Fraud Protections Popular, But May Not Get Floor Vote

New York Republican Representative Nicole Malliotakis said a bipartisan compromise plan in the House would extend Obamacare subsidies with protections against fraud but its unclear whether it will get a vote.

The Senate rejected a pair of partisan measures addressing the impending expiration of Obamacare subsidies, setting up a Jan. 1 spike in health insurance premiums for more than 20 million Americans.

With only a few days left before lawmakers leave for their Christmas break and few signs of life in stalled bipartisan negotiations, the failure Thursday of the dueling partisan plans all but guarantees the expiration of enhanced Affordable Care Act tax credits initiated during the pandemic era.

Premium costs on average will more than double for people enrolled in Obamacare plans, forcing many of them to make hard choices on their health coverage and household finances. The outcome will have wide-ranging consequences for insurance companies, a health-care sector that accounts for one-sixth of the US economy and potentially next year’s midterm elections.

Nearly 4 million people are expected to lose insurance over the next decade as a result, according to the Congressional Budget Office. Fewer healthy people signing up for health plans could also harm health insurers’ bottom lines.

If fewer people buy health-care policies because of the higher costs, insurers will take in less revenue. And as healthy people choose to risk going without insurance coverage while sicker people stick with insurance plans, insurance becomes more expensive. Insurers including Centene Corp., Molina Healthcare Inc. and Oscar Health Inc. stand to lose the most.

UnitedHealth Group Inc., Elevance Health Inc., and Cigna Group also sell exchange plans that would be hit if subsidies lapse. Hospitals also stand to come under more financial pressure as patients arrive without insurance coverage and aren’t able to pay for their care.

The Democrats’ plan for a three-year extension of the Obamacare subsidies failed in a 51 to 48 vote, short of a 60-vote threshold needed to overcome procedural obstacles. Alaska’s two Republican senators, Lisa Murkowski and Dan Sullivan, joined Susan Collins of Maine and Josh Hawley of Missouri to cross party lines and vote with Democrats on the bill.

A Republican plan to let the Obamacare subsidies lapse and partially replace them with federally funded tax-advantaged health savings accounts also failed on a 51 to 48 vote.

The votes underlined the political challenge facing Republicans, who largely oppose the premium tax credits despite their popularity with voters. Three-quarters of Americans said they favored continuing the subsidies in a poll taken Oct. 27 to Nov. 2 by KFF, a nonpartisan health policy research institute.

Senate Health, Education, Labor and Pensions Chairman Bill Cassidy of Louisiana, one of the authors of the Republican bill, shot down Democrats’ efforts to extend the subsidies, even for only a year, equating it to a giveaway to insurance companies. Senate Democratic leader Chuck Schumer, meanwhile, called Republicans’ bill a “ridiculous proposal.”

Democrats have seized on the expiring tax credits as a way to paint Republicans as out-of-touch with the high costs voters face, part of a midterm election strategy laser-focused on affordability. A handful of Democrats won the guarantee of a Senate vote on renewing the subsidies in exchange for their support to end the government shutdown last month.

The issue has divided Republicans, pitting moderates and lawmakers from states and districts with high ACA enrollment against GOP leadership and the rest of the party.

Reliance on Obamacare is especially high in GOP-controlled states, which were less likely to expand Medicaid under former President Barack Obama’s sweeping health care law. That has ratcheted up pressure on Republicans to present an alternative to Democrats’ message on health care before they face voters next November, though they’ve struggled to unite around a vision.

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