Lower Health Care Costs Act
Lower Health Care Costs Act
Plain Language Summary
# Lower Health Care Costs Act - Summary **What the Bill Would Do:** The Lower Health Care Costs Act would extend financial assistance for people buying health insurance through federal marketplaces for three additional years (through 2028). Specifically, it would continue expanded tax credits that help people afford monthly insurance premiums. These credits were temporarily increased by previous COVID-relief and inflation-reduction legislation set to expire after 2025. The bill aims to keep these expanded benefits in place longer, making health insurance more affordable for eligible purchasers. **Who It Affects and Key Provisions:** This bill primarily affects individuals and families purchasing health insurance on their own (rather than through employers).
Currently, the expanded credits remove the upper income limit for eligibility—meaning higher-income earners can qualify for assistance—though this provision is set to end after 2025. The bill would maintain this broader eligibility and continue increased credit amounts. Without this extension, millions of people could face higher insurance costs starting in 2026, and some may lose eligibility for assistance entirely. **Current Status:** The bill was introduced in the 119th Congress by Senator Charles Schumer (D-NY) and remains in the introduction stage. It has not yet been voted on or moved through committee.
CRS Official Summary
Lower Health Care Costs ActThis bill extends for three years, through 2028, temporary changes enacted by the American Rescue Plan Act of 2021 (ARPA) and the Inflation Reduction Act of 2022 (IRA) that generally expand eligibility for and increase the amount of the premium tax credit. Currently, eligible taxpayers may be able to claim the premium tax credit, which applies toward the cost of obtaining health insurance through health insurance exchanges. To be eligible for the premium tax credit, a taxpayer’s household income must meet or exceed 100% of the federal poverty level (FPL) and, after 2025, may not exceed 400% of the FPL (maximum income limit). For 2021-2025, the ARPA and IRA eliminated the maximum income limit, which generally expands eligibility for the premium tax credit.Further, under current law, the amount of the premium tax credit is (1) generally the plan premium (conditions apply), minus (2) the taxpayer’s household income multiplied by the applicable percentage. The applicable percentage is a specific percentage that varies depending on which of six income ranges (adjusted for inflation after 2025) the taxpayer’s household income falls within. For 2021-2025, the ARPA and IRA lowered the applicable percentages and eliminated the adjustment of the applicable percentages for inflation, which generally increases the amount of the premium tax credit.The bill extends for three years, through 2028, the elimination of the 400% maximum income limit, the lower applicable percentages, and the elimination of the inflation adjustment for the applicable percentages.
Latest Action
Cloture on the motion to proceed to the measure not invoked in Senate by Yea-Nay Vote. 51 - 48. Record Vote Number: 644. (CR S8654-8655)