Congress Failed to Extend the Health Care Subsidies. Now What?

From The New York Times, I'm Rachel. Abrams and this is The Daily. I don't really pray much. But. I pray at night that something happened. that I wake up in the morning and I. check the news and that the subsidy was. extended. Something that will make it. not $55,000 next year. Something. This week, despite a last-ditch effort. by some House Republicans to strike a. deal on health care, Capitol Hill.

remains deadlocked on whether to extend. support for millions of Americans who. get their health care through the. Affordable Care Act. Without subsidies, it would be the minimum of $1,500 a. month. And there was no way. My original. estimate was about a 1,200% increase. I. think I was in. tears the entire rest of the week after. I got that news. That's left those Americans to confront. a wrenching decision. I asked my. husband, like, what should we do? He's.

like, maybe we go without health. insurance. And I was like, oh my god, no. way. Keep paying for rising insurance costs. or risk going without it. It's been a really tough couple of. months. A lot of just like mentally preparing. for what this next year is going to look. like and it's pretty grim. Today, my colleague Margot Sanger-Katz. explains who will be [music] most. affected and how this could all change. the political landscape heading [music].

into the midterms. It's Thursday, December 18th. Margot, welcome back to The Daily. Thank. you so much. >> really feels like health care and. debates over health insurance have been. in the news like every other day almost. And in large part, that's because there. have been these really huge and ongoing. and changing debates on Capitol Hill. But it really feels like this week in.

particular we have reached an inflection. point, which is why we wanted to have. you on the show. The last time we had. you on, it was in the thick of the. shutdown fight and we're bringing you. back here so that you can bring us up to. speed on where we are now. So, as you may remember, the real crux. of the fight over the shutdown was. whether or not Congress was going to. extend these subsidies that help people. buy insurance in the Affordable Care Act. marketplaces. This was the thing that. Democrats decided to make the. centerpiece of their fight. And they. chose to fight over these subsidies.

specifically because I think they felt. like this was a really strong issue for. them. Voters trust them more on health. care. It's like one of the Democrats'. strongest issues. But it has not been. the biggest issue that was in the. forefront of people's minds. It was a. little bit of a gamble. You know, were. they going to be able to get people to. pay attention to this? But they did. And it didn't work from the perspective. of getting legislation passed. They shut. down the government for a record period. of time. Ultimately, they decided to. reopen the government without.

legislation to extend these subsidies. >> Right. Democrats basically lost that. fight. They agreed to reopen the. government with no deal on these health. care subsidies. The one deal they got is. that they were going to get to put up a. vote on the Senate floor. They did that. Republicans didn't vote for it. It. didn't go anywhere. So, that was all. they got was a kind of failed vote on. this issue. And then since then, a lot. of Republican lawmakers, particularly. moderate Republicans in the House, have. been worried about what to do because. they know that the loss of these. subsidies is going to affect their.

constituents and I think they're worried. about political consequences when the. midterms roll around. So, there's been. this kind of deal-making debate between. some of these moderate Republicans and. Democrats. Could they form a compromise? Could they pass something that would. patch the subsidies and that other. Republicans could sign on to? But the. deadline for enrollment came on Monday. and they did not pass anything like. that. >> So, this is the open enrollment that. we're all quite familiar with at this. point from the Affordable Care Act. >> Yeah, I mean, you probably have the same. thing for like we have same thing here. at The Times for our work uh insurance.

There's some period of time in which you. have to pick and pay for your health. insurance and that signs you up for the. whole year. And there just are deadlines. that happen every year. So, even though. we're not at the end of the year now, we're kind of a little bit at the end of. the line for these subsidies. People had. to make their choices. Right. Now, that. said, it may not be totally over. This. week something kind of unusual happened. A couple of moderate Republicans who are. really mad at the Speaker of the House. for not giving them a chance to vote on. this, joined up with all of the. Democrats to sign what's called a.

discharge petition, which is a way to. get a bill on the floor without the. House Speaker's cooperation. And that. bill would extend the subsidies for 3. years. >> Mhm. But that bill isn't going to come. up for a vote for probably a couple of. weeks and it's not clear whether it can. pass the Senate. So, for now, it looks. like these subsidies are going to expire. and a lot of people are going to have to. pay more for their health insurance. So, the key word that we have been using a. lot here is subsidies. But I want to. make sure that people actually. understand what that means. Specifically, what were the subsidies.

and how are they changing? So, if you. will indulge me, I think it makes sense. to go back in time a little bit and talk. about Obamacare. >> Definitely. So, when Democrats passed. the Affordable Care Act in 2010, they. set up a system where people who don't. get their insurance through work or. through a government program have access. to a market. And if they make less than. 400% of the federal poverty level. That's like $63,000. >> Right. That sounds like a lot. >> this year. It might sound like a lot. 400%, but that is For a single person, it's like $63,000. For a larger family,

you might be talking about $100,000. If. you make less than that, you get some. help buying your insurance. And it's on. a sort of sliding scale. So, the poorer. you are, the more help you get. And the. idea was to make insurance affordable. for people who didn't have it. But over. time, what a lot of the authors of the. Affordable Care Act realized is that the. health insurance was still kind of. expensive for these people who were. uninsured. So, going into the pandemic, there were around 12 million people who. were signed up for Obamacare plans. That.

was less than everyone had expected when. the bill passed. And so, when the. pandemic happened and there was this. real openness to spending more money by. the federal government, Democrats. revisited those original subsidies and. they topped them off with new subsidies. that made the payments even more. generous and asked people to pay even. less of the total bill for their health. coverage. So, what did those more generous. subsidies look like? So, under the. system that Democrats passed during the. pandemic, basically everyone who buys.

insurance in this market got more. financial help. >> Mhm. But there are two groups that I. think benefited particularly. One group was the poorest Americans in. this market. The way the Affordable Care. Act calculates that is anyone who earns. less than one and a half times the. federal poverty level in a given year. That's a little less than $25,000 this. year. The Democrats reset the subsidies so. that those people have to pay nothing. >> Nothing. Zero. They can get an insurance.

plan basically for free. >> Mhm. And then there's a new group who. actually didn't get [music] any. subsidies under the original Obamacare. design who were now under this enhanced. subsidy structure getting help for the. first time. So, these are people who. earn more than 400% of the federal. poverty level. And you know, this is a. group that includes a lot of. entrepreneurs, people who work for small. businesses that can't offer insurance, farmers and ranchers, and also early. retirees who either chose to stop.

working early before they qualified for. Medicare, or maybe lost their job and. were [music] having trouble getting back. into the job market and are living off. their savings. So, basically, it sounds like the. Democrats decided that not only did the. subsidies need to get more generous, but. they also needed to be available to a. [music] lot more people. Well, I think. this was a group that a lot of Democrats. felt were really slipping between the. cracks. And so, I think Democrats were. kind of happy to come back and try to. fix this program. And it actually made a. very big financial difference for some. of these people.

So, that's the plan that Democrats. implemented in 2021. And at first, they. made it really short-term. But then they. immediately saw that tons more people. were signing up for coverage. Do we know. who was really driving that surge? What. kind of people? What kind of income. level? Almost all of this growth is coming from. that bottom income category. So, those. are the people that are eligible for. these zero-dollar premiums. I think. there are a couple of reasons why that. happened. One is just that's a group. that's much more likely to be uninsured.

If you think about the kinds of jobs. that low-income people have, they're. just much less likely to come with. health insurance. You know, if there's. someone who has a bunch of gig economy. jobs that they're patching together, or. a part-time job, those are the kinds of. jobs generally don't have health. insurance. And so, those people are. really benefiting from the ability to go. get a free plan somewhere else. It's also like free is a really. important horizon, it turns out. Even. asking people to pay a small amount can. really discourage them and particularly. low-income people from enrolling in. these kind of programs. A lot of really. low-income people don't even have a bank.

account. >> Mhm. And so, if you just imagine the. mechanics of like, how is that person. going to pay a monthly premium? They. can't write a check, they don't have a. credit card. Not impossible, but makes. it harder. What did Republicans think of all these. changes to the Obamacare subsidies? Well, I think it's important to remember. Republicans never liked Obamacare. They. felt like it was a waste of money, they. thought it was uh putting too many rules. on the health insurance system. And this. was a huge expansion. It's a lot more. dollars, was bringing more people into. the system. And I think they also. objected to some of the specific policy.

changes. They really didn't like the. idea that all these people were going to. get insurance for free. It felt sort of. unfair to them. Everyone else has to pay. something for health insurance. And I. think a lot of Republican lawmakers feel. like even these very low-income people, if they really value their insurance, they should have to pay some minimal. amount just to prove that it's something. that they really want and need. >> Mhm. But of course, that didn't matter. at the time because the Democrats. controlled the entire government. They. had the Senate, the House, and the White. House. So, when 2022 rolled around, the.

Democrats decided to extend these more. generous subsidies for even longer. They. just weren't able to make them permanent. because, as you may remember, Joe. Manchin, the conservative Democratic. senator from West Virginia, insisted. that they not make this a permanent. policy. Democrats chose to have the. policy expire in 2025 because they were. hoping that they would have enough. control in the government that they. would be able to eke out a. bipartisan compromise to extend the. subsidies further. But, of course,

that's not what happened. Republicans. swept to power in 2024, and that's why. we're now in the situation where the. only way that they were able to advocate. for this policy was by shutting down the. government. Okay, and so that brings us to this. moment where the subsidies are expiring, no agreement has been reached. What do. we know about the people who'll be most. impacted by the fact that these are. going away? Basically, everyone in this market is. going to be affected to some degree. I. said there were around 12 million people. in the market before the extra. subsidies. Now, there about 24 million.

people in the market. So, this. low-income group we were just talking. about, that's the biggest group. It's. like half the market, and those people. are going to have to go from paying. nothing for their insurance to paying. somewhere around $50 a month for their. insurance. Then there's this kind of. middle-income group, and those people. are also going to have to pay more for. their insurance, probably somewhere in. the neighborhood of like $150 more per. month on average. And then you get to. this group earning more than $65,000, and that is a small share of the market,

but in dollar terms, those are the. people that are facing the biggest. effects. Some of those people are. looking at price increases in the. neighborhood of one or even $2,000 more. per month without these enhanced. subsidies. Right, because for that. group, those highest earners, their. subsidies are going away entirely, and. so they'll see the biggest potential. increase. Yeah, that's right. They are looking at. just absolutely huge and astronomical. price increases that may be impossible. for some of them to pay.

So, over the last few weeks, as [music]. people in all of these income categories. have been looking at their options and. thinking about the ongoing drama in. Washington, I think that a lot of them. have started [music] to consider some. really difficult choices. Should they buy a less generous plan. with a really high deductible [music] so. they don't have to pay as much? Should. they try to rearrange their work so. maybe they earn less and they get right. under that threshold where they could. qualify for a subsidy? [music]. Do they need to earn more money, get a. second job, or cut back on [music] some.

of their living expenses in order to be. able to pay the premium? And all of that. has really [music] come to a head this. week. When the deadline hit, the. subsidies were not extended, and people. had to ultimately [music] decide what. kind of insurance they were going to. choose, if any insurance at all. >> [music]. >> We'll be right back.

Hello. Good morning, this is Lizzy. Hey, this. is Anna from the Times. How you doing? All right, what can I help you with? Daily producer Anna Foley has been. talking to people who get their. insurance through the Affordable Care. Act marketplace to hear more about how. they're navigating the reduction in. subsidies. Why don't you just go ahead and start by. telling me a little bit about yourself? I live in Mountain City, Tennessee. I.

was a. delivery driver for Amazon. I work for a small family business. I. run my daughter's tattoo shop. So, I am. a small business owner. Do you like. being your own boss? You know, it suits. my personality type. I don't like people. telling me what to do. But, honestly, the the stressors of. things like this, of health care, it's. gotten really hairy. It's gotten really, really difficult.

There were truly no good options. Every. single plan forced me to compromise on. cost, on providers, and on. prescriptions. Every single one of them. I have a. >> [music]. >> rare chronic illness called um. eosinophilic asthma, and I need to receive a specialty. biologic injection every month. in order to be able to breathe. And the co-pays on that drug alone.

are $350. a month, which takes my overall. health care costs to about $700. a month. It's. a shame that it's a luxury. to have air in my lungs. What are you going to have to change in. your life to now cover this health care. cost? I'm having to make a wholesale.

decisions about my career based on my. health insurance. >> [music]. >> Like after all these years and all this. expertise I've built, do I go and down. to Starbucks and just [music] work at. Starbucks for benefits and make nothing, but at least I have catastrophic [music]. coverage for my family? I already. >> [music]. >> live a very frugal lifestyle. So, [music]. it's just going to be that on steroids, you know.

Um more couponing, walking to work instead of driving my. car. Um Oh, wow. How far is that walk? 3. miles. Oh. That's not nothing. It isn't nothing, no. And [music]. Christmas this year has already been. difficult. Um. I wanted to get my mom hearing aids for. Christmas, but now I've settled on a couple Yankee. candles. instead.

I also got married this year, >> [music]. >> but that changes things monetarily, right? Because if your family. household size is one, >> [music]. >> you are able to make significantly. more. as one person. >> [music]. >> than you are as two people. You know, like so when you get married, you can only make up to [music] $84,600. to stay under that 400% poverty level.

So, it's like do we just get divorced? You know what I mean? Like it's. something we're [music] considering is. getting divorced. Really? Yes. We're kind of stuck with no option. basically without these subsidies. So, [music]. you know, thankfully we stay as healthy. as we possibly can, but you know, we're. just going to have to hope for the best. and just pay out of pocket as needed. So, as of right now, you don't have. health. >> [music]. >> insurance for 2026.

Correct. Yeah, we only have it through. December 31st of this year. I've got a. houseful of several family members who. say they're hoping they'll get the. Congress will get their act together and. get something passed to help out, otherwise they're going to have to drop. their insurance. So. There are a few things out in the world. that I cannot control myself. I'm a. total control freak. I need the. government to help [music] in very few. situations. The rest, I promise I will. take care of. This is a blinding bright.

light where. people need [music] help. I just feel like I've done everything. right my whole life and. and I just feel like I've just been sold. a bag of And now, now what am I going to do? It's like, okay, I got it. [music]. Really, really rethink my future. And so it gives me a sense of. loss and bewilderment and.

>> [music]. >> regret. Margo, our colleague Anna Foley, who's a. producer here on the daily, has been. spending a lot of time talking to people. who are in the middle of making these. really difficult health care choices. right now. And I wonder if you might be able to. project forward for us a little bit. Like what might this start to look like. heading into next year and beyond for.

these people? We don't really know for sure. The. Congressional Budget Office, so they're. the nerds that help Congress figure out. what their laws are going to do. They. think that about 2 million more people. will become uninsured in 2026 as a. result of this policy and almost 4. million people over the course of the. next decade, but there are other serious. analysts who have estimated a much. larger impact. Enrolling in the. marketplaces has doubled since they put. this policy in place in 2021. So, if you. think about all of the people who newly.

became insured in this market, that's 12. million people. And we're kind of. snapping back to the policy from before. And on the one hand, that is really. disruptive for the folks who can no. longer afford their health care or have. to dramatically rethink the health care. they can afford. But in some ways, it also represents a. reversion back to kind of a status quo. And so I'm wondering how you are. thinking about the world that we are. about to enter. Yeah, I think Democrats actually have. been somewhat misleading in the way that.

they've been talking about it. They keep. acting like the subsidies are going to. go away, and I think that has caused. some alarm among some people that all of. the subsidies are going away, that. people are going to all have to pay the. full cost of their health insurance. And. that's not true. What we're reverting. back to is the original structure of. Obamacare that Democrats thought really. carefully about and wrote and passed in. 2010. So, we do know that way more. people bought insurance with this extra. financial help. It definitely does make. a difference in people's lives and it. does make a big difference in people's. coverage. But, there is a real debate.

about what level of subsidization is. appropriate in these markets and whether. and how much people should be asked to. pay for their health insurance. Because. in part, over the same period of time in. which we've been paying all this extra. money to help people buy insurance, the. cost of insurance itself has gotten a. lot more expensive. And why is it that health insurance has. gotten so expensive over the last few. years? So, people love to rag on health. insurance companies and no one really. likes them. They don't like how. expensive they are. There are lots of. other things they don't like about them.

But, the reason why health insurance is. so expensive is because health care in. the United States is really expensive. and the costs are growing over time. And. there are a bunch of reasons for that. Recently, of course, we've had these. GLP-1 anti-obesity medications, super. transformative drugs. They really could. help a lot of people improve their. health, but they're costly and lots of. people want to take them. And that's an. example of a much broader trend in the. US health care system, which is that we. love to use new technology when there. are new drugs or treatments on the. cutting edge that really seem to make a.

difference in public health, we want to. use them even though they're going to. cost a lot of money. I know you mentioned earlier that in the. weeks since the shutdown, Republicans. have been trying to get some kind of. health care bill together and now we. have this discharge petition. But, I do. wonder as of Wednesday afternoon, what. appears to you like the most likely. resolution to all of this? I think it's just really hard to say. We. are right in the middle of this debate. I think what you can see with this. discharge petition is that there are.

some Republicans who are really worried. about this issue politically. But, you. can also see that there are other. Republicans who really just don't like. Obamacare and don't want to be pouring. more money into it and they're kind of. having this fight within their own. party. They control the government and. the Democrats cannot get this policy. done by themselves. And so, I think. we're just going to have to watch over. the next few weeks to see if there's. some kind of compromise. >> Mhm. But, even if one of these bills. comes together in the next few weeks or. months, it's still going to be kind of. complicated because a lot of people have. already picked their plans for the year. and they wouldn't have chosen their.

insurance knowing that these subsidies. are coming back. But, I think the most. likely scenario is we're kind of just. snapping back to this pre-pandemic. policy where people do have help buying. their insurance, but not nearly as much. as they've had in these last few years. I wonder how we should think about the. political pressure that you mentioned. because. not only are we heading into a midterm. election year, but it was only last year. that the head of United Healthcare was. shot and killed in the streets and. people were quite frankly cheering. They.

were saying that this is what happens. when United and all these other. insurance companies charge too much. They're taking advantage of people. So, in terms of the political. implications of potentially knocking. millions of people off of their health. insurance, how does that change the. political landscape? A lot of these. people who have benefited from these. enhanced subsidies actually don't live. in the places that Democrats govern. They live in states that are controlled. by Republicans and that voted for Trump. in the last election. So, the biggest. increases of enrollment in Obamacare.

have been in southern states, Texas, Florida, Tennessee, Georgia. These are. real Republican states and those voters. may have something to say if they blame. their Republican lawmaker for losing. this really important financial. assistance that they were getting and. they might vote them out of office. But, I do think it's important to note this. is a relatively small share of the. public. We are only talking about 24. million people who are in this market. And in overall polling, very few.

Americans are currently ranking health. care as one of their number one issues. going into the next election. >> [music]. >> So, I think the question is, does the. subsidy issue start to function more. like a metaphor where it's reminding. Americans of their frustrations with the. high cost of the health care system. outside of this small market because. health care is getting more expensive. for everyone. Right. And of course, there's a much larger conversation. happening in this country right now. about affordability [music] writ large, right? Like even beyond health care,

that is on people's minds. It's. certainly on voters' minds. Sure. And I. think there's a real question about how. this issue evolves over the course of. the midterm election as Americans hear. more and more stories like this from. their neighbors and their family members. and their friends. >> [music]. >> Margot Sanger-Katz, thank you so much. for joining us. Thanks for having me on. >> [music]. >> We'll be right back.

>> Here's what else you need to know today. Dan Bongino, the number two official at. the FBI, [music]. said on Wednesday that he would step. down next month, bringing an end to his brief but. tumultuous stint [music] at the bureau, where he was known for his volcanic. temper, missteps, and hyperactive. presence on social media. >> [music]. >> The upheaval comes at a precarious.

moment for the bureau and for the White. House. President Trump and his. appointees to the FBI, which long. operated independently of [music] White. House interference, is a critical part. of his retribution agenda. And. Warner Bros. Discovery went on the. attack on Wednesday [music] against the. attempted hostile takeover of the. company by Paramount. Warner Bros. Discovery [music]. urged its shareholders to reject. Paramount's offer and said that.

Paramount's owners, the billionaire. [music] father-son duo Larry and David. Ellison, have, quote, consistently. misled them. The Ellisons are determined to. outmaneuver Netflix, >> [music]. >> which reached a deal to buy a large. portion of Warner Bros. business earlier. this month. >> [music]. >> Today's episode was produced by Anna. Foley, Olivia Nat, Stella Tan, and Diana. Wynn, with reporting [music] from Anna Foley. It was edited by Rob Zipko,

contains music [music] by Dan Wong, Alicia Beattie, Marion Zano, and Pat. McCusker, and was engineered [music] by Alyssa. Moxley. >> [music]. [music]. >> That's it for the daily. I'm Rachel. Abrams. See you tomorrow. >> [music].