Senate to vote on dual bills on looming expiration of Obamacare tax credits

The US Senate will vote Thursday on competing bills to address the imminent expiration of subsidies for Affordable Care Act health insurance plans, but neither measure is expected to pass, greatly increasing the chances that healthcare costs will soon rise to unaffordable levels for many Americans.

The votes, part of a deal brokered between Republican majority leader John Thune and the Democratic senators who agreed to reopen the government after a historically long shutdown last month, come as premium tax credits for an estimated 21.8 million enrollees of the plans are set to expire at the end of the month. Health policy research group KFF estimates that annual premiums will more than double if the subsidies are allowed to expire.

While Democrats have proposed extending them for three years, Republicans are poised to oppose their bill, claiming that the 2010 law, commonly known as Obamacare, has failed at its promise of lowering healthcare costs, and that further tax credits would be untenable.

“The Democrat proposal, which is a three-year extension of the status quo, is an attempt to disguise the real impact of Obamacare’s spiraling healthcare costs,” Thune said in a floor speech on Wednesday.

Democrats have countered by accusing Republicans of not being serious about their promise to lower the cost of living in the United States. The issue was at the heart of the 2024 presidential campaign, and has been linked to Donald Trump’s recent decline in public approval, as voters increasingly say he has not done enough to make life more affordable.

“The bottom line is that the Republicans do not have a serious plan to fix our healthcare problems. But we Democrats do – a clean, simple extension to prevent premiums from going up,” said Senate minority leader Chuck Schumer.

The premium tax credits were first created under Joe Biden, and Schumer has proposed a bill extending them through 2028.

Thune has backed a measure introduced by Republican senators Bill Cassidy and Mike Crapo, which is built around government payments of $1,000 into the health savings accounts (HSAs) of people enrolled in bronze or catastrophic exchange plans, which typically have high deductibles. People from the ages of 50 to 64 would get another $500, and there would be limits for all who received the funds on using it to pay for abortions or gender-affirming care.

Both bills would need at least some bipartisan support to clear the 60-vote threshold for advancement in the Senate, a bar that neither appears to have reached.

Bernie Sanders, the independent senator who is the ranking member on the Senate health committee, said the Crapo-Cassidy bill “would make an already broken and outrageously expensive healthcare system even worse” and would encourage people to switch to plans with unaffordable deductibles in exchange for payments into their HSAs.

“It would do nothing to prevent premiums from doubling, tripling or even quadrupling for millions of Americans. It would do nothing to lower the outrageous cost of healthcare or prescription drugs. It would do nothing to make it easier for Americans to see a doctor when they get sick,” said the senator, who caucuses with the Democrats.

Trump presided over an unsuccessful attempt to repeal Obamacare in his first term, which played a role in the Democrats retaking control of the House of Representatives in the 2018 midterms. The law is relatively popular, with a Gallup poll released this week finding 57% of voters approve of it, and Republicans have not made any serious attempts at its repeal since Trump began his second term in January.

In an interview with Politico published on Tuesday, Trump criticized the Affordable Care Act and signaled approval of the Republican senators’ proposal. “I want to give the money to the people, not to the insurance companies,” he said. He had previously sounded open to an extension of the tax credits, saying last month: “Some kind of extension may be necessary to get something else done.”

Any legislation passed by the Senate would need to win the approval of the Republican-controlled House, where speaker Mike Johnson has said he opposes the tax credits.

At a Wednesday press conference, he said that the House GOP planned to soon unveil its own bills to make healthcare more affordable, without giving details.

“The overall system is broken, and we’re the ones that are going to fix it. You will see that laid out,” he said.

A bipartisan group of moderate House lawmakers also introduced a proposal in the House this week that would extend the premium tax credits through 2027, while imposing new caps on the income of enrollees and protections against fraud.