Inflation Reduction Act

Back in September, Covered California announced that the weighted average individual market premium increases for 2023 (for unsubsidized enrollees) will be around 5.6%, down slightly from the 6.0% average requested by carriers. However, the press release, besides not including a carrier-level breakout of the rate hikes, also didn't say anything about California's small group market.

Yesterday they addressed that as well:

Covered California for Small Business Announces a Weighted Average Rate Change of 7.1 Percent for 2023

Back in July, Covered California posted the preliminary 2023 rate changes for ACA individual market healthcare policies. Overall, the weighted average rate hike was around 6.0% across the entire statewide market.

Yesterday, CoveredCA announced that thanks to the Inflation Reducation Act being signed into law by President Biden...

...@CoveredCA is announcing a reduction in its 2023 average rate change from 6% to 5.6%. The 0.4% decrease is due to the Inflation Reduction Act ensuring increased financial help for next year. Renewal begins Oct. 1 and #OpenEnrollment starts Nov. 1 for #ACA coverage.

Unfortunately they haven't posted the rate changes for each individual insurance carrier yet, but assuming it's fairly even across all of them, the premium savings should amount to something like:

Back in 2019, long before the American Rescue Plan passed, I embarked on an ambitious project. I wanted to see what the real-world effects would be of passing a piece of legislation which would eliminate the Affordable Care Act's so-called "Subsidy Cliff" while also strengthening the subsidy formula for those who qualified. Call it "ACA 2.0" for short, if you will (that's what I do, anyway).

This legislation has been around in near-identical form under one official title or another for years, usually bundled within a larger healthcare package. In 2018 it was called the "Undo Sabotage & Expand Affordability of Health Insurance Act of 2018" (or "USEAHIA" which is about as awkward a title as I can imagine.

In 2019 it was rebranded as the "Protecting Pre-Existing Conditions and Making Healthcare More Affordable Act" or "PPECMHMAA," which somehow managed to be even more awkward.

Covered California Logo

via Covered California:

  • The Inflation Reduction Act extends the increased financial help initially provided by the American Rescue Plan through the end of 2025.
  • The increased subsidies expanded health care coverage, leading to record enrollment in California and across the nation, and lowered insurance costs for people who signed up through an Affordable Care Act marketplace.
  • The landmark legislation will continue to make coverage more affordable at a time when many individuals and families are facing increased challenges in the current economic environment.

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via the Michigan Dept. of Insurance & Financial Services:

(LANSING, MICH) Michigan Department of Insurance and Financial Services (DIFS) Director Anita Fox is applauding Congress and the Biden Administration for enacting the Inflation Reduction Act which, in part, will extend increased Health Insurance Marketplace premium subsidies for another three years. These subsidies, first expanded by the American Rescue Plan, have enabled 4 out of 5 enrolled Americans to find health insurance for less than $10 per month on 

Get Covered NJ Logo

This just in via the New Jersey Dept. of Banking & Insurance (via email for now):

Statement from New Jersey Department of Banking and Insurance Commissioner Caride on President Biden’s Enactment of the Inflation Reduction Act  

TRENTON – New Jersey Department of Banking and Insurance Commissioner Marlene Caride today released the following statement on the signing by President Biden of the Inflation Reduction Act:

With the signing of the Inflation Reduction Act, President Biden and Congress have preserved a lifeline to health insurance for millions of Americans. For New Jersey, this means the preservation of record levels of financial help that have made health insurance through Get Covered New Jersey more affordable for hundreds of thousands of New Jersey residents.

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via MNsure, Minnesota's ACA exchange:

ST. PAUL, Minn.—Today, President Biden signed into law a sweeping investment in health care affordability for Americans that will help keep health care costs in check for over 70,000 Minnesotans.

The new federal legislation, called the Inflation Reduction Act, extends enhanced subsidies for private health plans purchased through MNsure, Minnesota’s health insurance marketplace. First introduced in 2021 as part of the American Rescue Plan, the enhanced subsidies made existing tax credits more generous and expanded eligibility for tax credits to include more middle-income families. The average annual savings for MNsure enrollees is $6,100 per household for 2022.

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via Connect for Health Colorado, Colorado's ACA exchange:

DENVER— Today, President Biden signed the Inflation Reduction Act into law. In addition to tackling issues such as climate change, health care and prescription drug costs, the legislation will extend the expansion of Affordable Care Act marketplace premium tax credits through 2025.

Connect for Health Colorado’s Chief Executive Officer, Kevin Patterson, released the following statement:

Access Health CT Logo

via Access Health CT, Connecticut's ACA exchange:

  • The bill extends enhanced subsidies for three more years and helps bring down costs for Connecticut residents who need financial help to pay for the cost of their health insurance premiums

HARTFORD, Conn. ( August 12, 2022) — Access Health CT (AHCT), Connecticut’s official health insurance marketplace, today announced Connecticut residents who purchase health insurance on the exchange will continue to receive enhanced subsidies thanks to the Inflation Reduction Act (IRA). The enhanced subsidies, which were set to expire at the end of the year, are advanced premium tax credits that help Connecticut residents pay for the cost of their monthly health insurance payments. This financial help is now extended for three more years.

UPDATE 8/16/22: President Biden officially signed the Inflation Reduction Act into law this afternoon!

Annnd there you have it: In a strict party-line 220-207 vote, the Inflation Reduction Act (a stripped-down version of the Build Back Better Act, which was originally branded as the American Families Plan) finally passed the U.S. House of Representatives after passing the U.S. Senate 51-50 (with Vice-President Harris as the tie-breaking vote) on Sunday. I presume President Biden will be holding a big, formal signing ceremony sometime next week.

A big chunk of the bill is related to climate change, of course, and another large chunk of it is purely related to deficit reduction. As for the healthcare provisions, here's a summary of what's included: