President Joe Biden's administration has been working on a fix to what's known as the Affordable Care Act's "family glitch," a quirk estimated to be keeping about 5 million people from getting coverage under the law. The White House announced the new policy proposal Tuesday.
People tripped up by the family glitch are dependents of workers who have an offer of employer coverage that the government interprets as being affordable. As a rule, people with affordable employer coverage are not eligible for taxpayer-subsidized ACA plans.
But the issue with the current interpretation is that affordability is determined by the cost for employee-only coverage, and not more expensive family policies. Workers able to afford their own share may not be able to cover premiums for the entire family. So the family is cut out of ACA coverage.
A Biden administration regulation addressing the issue recently cleared White House review. The intent of the original policy was to prevent people with employer coverage from going into the health law's subsidized markets, but advocates say it has proven too restrictive.
The White House estimates that the fix would help 200,000 people get insurance and bring costs down for nearly 1 million more.
Former President Barack Obama returns to the White House on Tuesday for a moment he can savor. His signature Affordable Care Act is now part of the fabric of the American healthcare system, and Biden is looking to extend its reach. Sign-ups under the health law have increased under Biden's stewardship, and more generous taxpayer subsidies have cut costs for enrollees, albeit temporarily.
Shortly after taking office, Biden opened up the health insurance markets to anyone seeking coverage during the COVID-19 pandemic, and his coronavirus relief bill provided a significant, though temporary, increase in financial assistance. The result was a record 14.5 million people signed up for subsidized private coverage.
Unless Democrats in Congress finally coalesce around a version of Biden's social legislation, his enhanced financial assistance for millions purchasing ACA plans will expire at the end of this year. A return to higher premiums would likely trigger an increase in the number of uninsured people, a political embarrassment for Democrats committed to expanding coverage.
The Biden legislation, which passed the House but sputtered in the Senate, also includes a mechanism for providing coverage to as many as 4 million uninsured low-income adults in states that have refused the health law's Medicaid expansion. It would deliver on Biden's campaign promise to build on existing government programs to move the U.S. closer to coverage for all.