Health Care Affordability Act of 2025
Health Care Affordability Act of 2025
Plain Language Summary
# Health Care Affordability Act of 2025 - Summary **What the Bill Does:** This bill would make permanent certain temporary health insurance subsidies that are currently set to expire after 2025. Specifically, it would extend expanded tax credits that help people afford health insurance purchased through the government healthcare marketplace. Currently, these enhanced subsidies were created as temporary measures under previous pandemic relief legislation, but this bill would keep them in place indefinitely. **Who It Affects and Key Provisions:** The bill primarily affects people who buy health insurance on their own (not through an employer).
It would remove income limits that currently cap eligibility for premium tax credits at 400% of the federal poverty level, meaning higher-income individuals could qualify for assistance. It would also maintain increased subsidy amounts that reduce what people pay for monthly insurance premiums. Supporters argue this makes health insurance more affordable; opponents typically argue about the fiscal cost of making these subsidies permanent. **Current Status:** The bill was introduced in the 119th Congress by Representative Lauren Underwood (D-IL) and is currently in committee, meaning it has not yet been voted on by the full House of Representatives.
CRS Official Summary
Health Care Affordability Act of 2025This bill makes permanent 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 makes permanent 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
Referred to the House Committee on Ways and Means.