Delaware Leads Push for Congress to Extend Health Care Subsidies

Delaware has emerged as a key player in a coalition of states advocating for the continuation of health care subsidies tied to the Affordable Care Act (ACA). More than a dozen states are urging Congress to preserve the enhanced premium tax credits, which are scheduled to expire at the end of 2025. These credits are vital for many residents as they help make health insurance more affordable through the Healthcare.gov marketplace.

Delaware Governor Matt Meyer recently joined forces with 17 other governors in a letter addressed to leaders in both the House and Senate, appealing for the extension of these crucial subsidies. During a news conference, Meyer highlighted the potential consequences for Delaware residents: “Thousands of our neighbors are projected to lose the subsidies that keep their health care within reach, with many unable to find a new plan at all.” He emphasized that when families face difficult choices between housing, food, and health care, it adversely affects not just Delaware’s economy but the broader national economy.

The Urban Institute, a reputable think tank in Washington, D.C., emphasizes that the enhanced tax credits have made insurance more accessible, particularly for those with incomes above 400% of the federal poverty level. Currently, over 21 million Americans rely on marketplace plans supported by these subsidies. Without an extension, average premiums may increase by more than 75%, with rural areas potentially facing hikes of up to 90%. This could result in an average increase of approximately $700 annually for families. In Delaware alone, over 16,000 residents risk losing their subsidies, with around 5,000 facing the possibility of losing insurance coverage entirely.

Delaware’s Deputy Insurance Commissioner Tanisha Merced reported that nearly 46,000 of the state’s more than 50,000 ACA enrollees benefit from tax credits, making up about 92% of policyholders. The subsidies have notably reduced premiums by an average of $538 per month, equating to savings of more than $6,400 annually. Merced warned that the loss of these enhanced subsidies could destabilize the state’s risk pools, leading to further premium increases for vulnerable populations, particularly those aged 55 to 64.

The discussion surrounding these subsidies is central to ongoing budget negotiations in Congress. Lawmakers are currently working on a short-term budgetary solution, but disagreements over tax credits could lead to a government shutdown by the end of this month. The House Republicans have proposed a stopgap bill that would fund the government through November 21, 2023. However, the debate over the ACA subsidies has introduced significant tension, as House Speaker Mike Johnson accused Democrats of using the funding extension to push partisan agendas.

In contrast, Senate Democrats are advocating for the inclusion of enhanced subsidies in their competing continuing resolution, which aims to keep the government operational until October 31, 2023. This measure seeks to make the enhanced tax credits permanent, reverse Medicaid cuts, and restore funding for various programs, including public broadcasting.

Senate Minority Leader Chuck Schumer recently stated, “ACA tax credits must be expanded. We believe that firmly and strongly, not just to save Americans thousands more each year that they’d have to pay, but for the very lives that are at stake if this expires.”

Despite the urgency, Congresswoman Sarah McBride and Senators Lisa Blunt Rochester and Chris Coons did not respond to requests for comments regarding the ongoing negotiations. In a recent interview, Senator Coons mentioned that he and his Republican colleagues are committed to ensuring the government remains open, indicating that healthcare costs stemming from earlier tax legislation could be addressed during the appropriations process.

As the debate unfolds, Delaware’s health insurance marketplace is preparing for the upcoming open enrollment period beginning on November 1, amid rising premium rates. According to the Delaware Department of Insurance, approved premium increases for the three marketplace insurers will range from 25% to 35%.

The potential impacts of these legislative decisions will resonate throughout Delaware and beyond, as residents grapple with the implications for their health care coverage.