Health Care Matters | June 21, 2024
Coverage Effects of the Enhanced Premium Tax Credits
Last week, the Urban Institute and the Robert Wood Johnson Foundation released a report evaluating the impact of enhanced premium tax credits (PTCs) on coverage. The authors found that relative to the previously authorized ACA marketplace subsidies, the enhanced PTCs will reduce the number of uninsured people in the U.S. by 4 million people in 2025. They also project that household net premiums will be lower by 50-100 percent for the lowest incomes groups (<300 percent of the federal poverty level) and by 23 percent for people with incomes between 300 and 400 percent of the FPL who receive subsidized coverage through the Marketplace.
Why It Matters
The enhanced PTCs were originally authorized via the American Rescue Plan to stabilize coverage during the COVID-19 pandemic and were then extended by Congress in the Inflation Reduction Act (IRA) of 2022. The subsidies are set to expire after 2025 and the debate around whether to extend them is underway. Conservative think tank, The Paragon Health Institute, has argued that Congress should allow the tax credits to expire and should cap the tax exclusion at 125 percent of the average value of an employer plan. Leading insurers, employer and business groups, and unions strongly advocate for an extension of the enhanced PTCs raising concerns that allowing the subsidies to expire would significantly reduce access to health care and drive up costs.
Supreme Court Decision on Chevron Doctrine Imminent
As we approach the end of June, the Supreme Court is expected to release its decision any day in two cases challenging the Chevron doctrine. The 40 year old doctrine indicated that, where a statute is ambiguous, courts should defer to an agency’s reasonable interpretation of the legislation. In January, the Supreme Court heard arguments in two cases challenging the doctrine.
Why It Matters
While the cases themselves are not related to health care, a decision that overturns Chevron would have sweeping implications across federal agencies, including Health and Human Services (HHS). Federal regulators, including CMS, rely on Chevron to interpret aspects of Congressional legislation and propose and finalize regulations through the notice and comment rulemaking process. The intent behind Chevron is that experts within the relevant federal agencies should be making policy and operational decisions where the law is unclear or not specific, rather than the courts deciding. If Chevron falls, legal experts anticipate a significant increase in legal challenges to Medicare payment policies and we may also see new legislation being significantly more prescriptive and detailed.
For more on Chevron, check out these articles:
WHAT WE ARE READING
Innovation in Behavioral Health (IBH) Model NOFO
CMS released the Notice of Funding Opportunity (NOFO) for its new IBH Model. Interested state Medicaid agencies have until September 9, 2024 to apply.
Hospital Global Budgeting: Lessons from Maryland
and Selected Nations
A new report from the Commonwealth Fund examines the way the state of Maryland and four countries have employed hospital global budgeting and what lessons they offer for wider adoption in the U.S.
