Biden rule change expands health insurance subsidies to 157,000 people in Michigan

An estimated 157,000 people in the state of Michigan will get access to more affordable health insurance coverage after President Joe Biden’s administration instituted a new rule affecting the Affordable Care Act on Tuesday.

The new rule is set to take effect in 2023. It is designed to address what has been called the “family glitch” in former President Barack Obama’s signature health care law, which was enacted in 2010.

The Biden rule will change a provision of the law that currently prevents family members from receiving subsidized health insurance. Right now, the law bases eligibility on individual employer policy costs, not family policies, which are generally more expensive.

Kaiser reported that 5.1 million people are currently affected by the glitch, including 157,000 people in Michigan. The think tank similarly noted that 180,000 people in Pennsylvania are affected by the issue, as are 269,000 in Florida, 593,000 in California, and 671,000 in Texas.

“An employee whose contribution for self-only coverage is less than 9.83% of household income is deemed to have an affordable offer, which means that the employee and his or her family members are ineligible for financial assistance on the Marketplace, even if the cost of adding dependents to the employer-sponsored plan would far exceed 9.83% of the family’s income,” the nonprofit Kaiser Family Foundation noted in an April 2021 report on the current law.

The new rule change would significantly broaden eligibility for subsidies. The Biden administration noted that upon the rule taking effect, 200,000 people who do not have health insurance coverage would be able to receive it, and estimated that 1 million people overall would see their coverage costs decrease.

“This proposed rule would amount to the most significant administrative action to improve implementation of the ACA since its enactment,” the White House said in a statement.

Appearing alongside Biden at the White House to announce the new rule, Obama noted that to get the original bill passed “we had to make some compromises.”

“We didn’t get everything we wanted. That wasn’t a reason not to do it. If you can get millions of people health coverage and better protection, it is, to quote a famous American, ‘a pretty big deal,'” said Obama.

Biden also announced he would sign an executive order which would direct federal agencies to highlight his administration’s Obamacare reforms and encourage American families to apply for the health care subsidies.

After the most recent open enrollment period, the administration noted in January that a record 14.5 million people had signed up for coverage, the most since 2016, Obama’s last year in office.

The surge of enrollment followed years of attempts under former President Donald Trump to undermine public enrollment in the Affordable Care Act’s health insurance exchanges through HealthCare.gov and other state-run health insurance websites. Working with Republicans in Congress, Trump supported a repeal of the law that would have left millions of Americans without health insurance.

The Biden administration has also proposed rules that would roll back Trump-era policies that undid Obamacare protections for LGBTQ people seeking health care. The administration also sent information to insurers reminding them of their obligations under Obamacare to cover contraception medications without copayments or deductibles.

Republicans have repeatedly tried to undo the law, most notably through two failed challenges at the Supreme Court. In addition, Republicans in Congress have repeatedly voted to repeal the law, while the Republican presidential candidates who supported repeal received fewer votes in the elections of 2012, 2016, and 2020.

After the most recent Republican challenge to the law in the court system failed in June 2021, Republicans in Congress said they would pursue further legislative attacks on the law.

Published with permission of The American Independent Foundation.