Trump administration considers extending ACA subsidies
TL/DR –
Dr. Mehmet Oz, the administrator for the Centers for Medicare and Medicaid Services (CMS), stated that discussions are ongoing about extending subsidies provided under the Affordable Care Act (ACA), conditional on the management of system fraud, waste, and abuse. The ACA subsidies, due to expire at the end of this year, have been a source of conflict, with Democrats advocating for their extension. It’s also mentioned that the Trump administration has proposed direct payments to Americans in place of the subsidies.
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Mehmet Oz: Trump Administration Contemplates Extending ACA Subsidies
In a recent appearance on CNN’s “State of the Union,” Dr. Mehmet Oz – head of the Centers for Medicare and Medicaid Services (CMS) – has shed light on internal discussions within the Trump administration regarding the extension of subsidies provided through the Affordable Care Act (ACA).
According to Dr. Oz, the administration is currently exploring the feasibility of extending these subsidies, assuming it can effectively eradicate the prevalent issues of fraud, waste, and abuse that are currently undermining the system. Oz relayed that majority of the fraud cases are related to agents, brokers, web brokers, and third parties who are working to enroll individuals into the ACA marketplace, as per insights from health policy research group KFF.
ACA Subsidies: A Contested Issue
ACA subsidies, due to expire at the end of this year, have been a subject of major contention during the 43-day government shutdown. Republican members of Congress advocated for the reopening of the government first, with the negotiations on the credits to follow, while their Democratic counterparts pushed for the extension of these subsidies as a condition in any funding bill.
On Wednesday last week, President Trump signed into law a continuing resolution that did not include an extension of these subsidies. Originally introduced during the COVID-19 pandemic, these subsidies were extended by the 2022 Inflation Reduction Act.
The Path Forward
Senate Majority Leader, John Thune (R-S.D), has pledged to hold a vote on extending the subsidies in December. Simultaneously, House Democrats have introduced a discharge petition to push for the consideration of a three-year extension of the credits.
As per CMS projections, the premium for the lowest-cost health insurance plan in 2026 will amount to approximately $50 per month, marking a $13 increase from this year, without taking into account the potential expiration of the subsidies. In contrast to these subsidies, which are paid to insurance companies by the federal government, Trump proposes to make direct payments to Americans. For the plan year 2024, four out of five HealthCare.gov customers managed to secure health care coverage for $10 or less per month after the application of subsidies.
Dr. Oz raises a vital question in conclusion, “How do we insure people, but make it sustainable?”
Updated Nov. 16 at 3:30 p.m.
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