Source: Politico
State health officials are scrambling to avoid millions of people losing health coverage before federal funding for Obamacare expires at the end of the year, Kelly reports.
California, Colorado, Maryland, Washington and other states are trying to avoid a fiscal cliff — and a sharp increase in out-of-pocket health costs — if Congress doesn’t extend the so-called enhanced subsidies, which provide financial assistance to low- and middle-income Americans.
“It’s such a large chasm, we can’t quite fill it from a state-level perspective, but it doesn’t mean we’re not trying,” said Kevin Patterson, the CEO of Colorado’s state-run exchange.
Why it matters: The efforts come as the prospects of the Republican-controlled Congress extending Obamacare subsidies grow increasingly dim. They also come as new tariffs create a wave of economic uncertainty, increasing the odds of a recession, which would further strain state budgets.
And the loss of subsidies might hit states alongside Republican cuts to Medicaid, which are being considered to help pay for Republicans’ plan to extend President Donald Trump’s tax cuts, border security and energy production.
States are worried the changes could cause the uninsured rate to increase after falling steadily over the past few years. The Commonwealth Fund — a progressive health care advocacy group — has predicted 4 million people would lose health insurance as a direct consequence of the enhanced Obamacare subsidies expiring.
In Washington state, Democratic lawmakers proposed $55 million in their 2026 budget released last month for a state premium assistance program, despite facing a $15 billion deficit. Though it won’t fully make up for lost federal dollars, health care affordability is a top priority, Democrats said, as they attempt to mitigate the blow.
“We know that there are signals coming from the federal government that they are going to cut funding in a number of areas that will directly impact affordable access to health care,” said Democratic state Rep. Nicole Macri. “We know that the federal premium assistance and tax credits end in 2025, and we are not hopeful that those will be extended, and so we felt it was just really important to continue to have those state subsidies for folks.”
Meanwhile, Colorado’s exchange is working with its health insurance advisory board to see whether the state can pull funding from its reinsurance program to help subsidize health insurance costs.
And Maryland lawmakers introduced a bill to allow the Obamacare exchange to use some of its reinsurance funding to replace the enhanced federal subsidies — if they expire — with a state subsidy.
“We may not be able to fill 100 percent of what that expanded tax credit was, but we probably could get pretty close to it for a year, for sure, and perhaps even a second year,” said Michele Eberle, executive director of the Maryland Health Benefit Exchange.
