Biden proposes expansion of Affordable Care Act with changes to ‘family glitch’

President Biden received some help from former President Obama Tuesday, as the White House announced a proposal aimed at lowering health insurance costs for millions of Americans. Margot Sanger-Katz, who covers health care for The New York Times, joins Amna Nawaz to discuss the impact this could have and who it could help.

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  • Judy Woodruff:

    President Biden got some help from former President Obama today, as the White House announced a proposal aimed at lowering health insurance costs for millions of Americans.

    Amna Nawaz has the details.

  • Amna Nawaz:

    Judy, the president announced a fix to what's been called the family glitch, that loophole in the Affordable Care Act that kept millions of people from qualifying for subsidized insurance plans.

    President Biden and former President Obama made the announcement earlier today at the White House.

    Here is President Biden laying out the issue.

  • President Joe Biden:

    Here's the problem. Under the current rules, a working mom is told, as long as she can afford employer-based coverage for herself, she can't qualify for premium subsidies to afford coverage for her family. Cover her, but not her family.

    We're working to change that.


  • President Joe Biden:

    Once today's proposed rule is finalized, starting next year, working families in America will get the help they need to afford full family coverage.

    For more on the impact this could have and who it could help, I'm joined by Margot Sanger-Katz. She covers health care for The New York Times.

    Welcome back to the "NewsHour," Margot.

  • Margot Sanger-Katz, The New York Times:

    Thanks so much for having me.

  • Amna Nawaz:

    So, let's talk about what President Biden laid out there and just make sure people understand.

    This family glitch issue, how was it making insurance more expensive for families?

  • Margot Sanger-Katz:

    So, the Affordable Care Act was designed to try to make insurance affordable for almost all Americans and had a bunch of different programs.

    One is, it said, if you work, your employer should make insurance available to you at a price that you can afford. And then there's another program, the Obamacare marketplaces, where people who don't get insurance through work can buy insurance. And, depending on their income, they can get help from the federal government to pay their premiums.

    The family glitch deals with people who are kind of caught in between those two programs. So, if you imagine a family where, say, the mom gets insurance at work, and the insurance is affordable for her, but if she wants to buy a family plan to cover husband, cover her kids, it would be too expensive.

    Currently, they can't go by a different plan in the Obamacare marketplace and get eligible for federal subsidies. So that's always been known as the family glitch. There are about five million people who are in this situation. Some of them just pay a whole lot of money to all be in the family plan in the employer, and some of them pay a whole lot of money to get a separate plan in the marketplace. And some of them are uninsured.

    So this is a new rule that's trying to kind of solve that problem and make it so that those people can go get subsidies if they need to buy their own insurance.

  • Amna Nawaz:

    And it's long — long been recognized as a problem, right, that people have been trying to fix.

    We should mention there's been some Republican pushback already. And many are saying this usurps congressional authority, this should be something that goes through Congress. Are they wrong?

  • Margot Sanger-Katz:

    I think it's a little bit ambiguous.

    So, the Affordable Care Act, the kind of last round of legislating was sort of lightning fast. And there were a lot of little sloppy things that went through. And so, in the Obama administration, the officials and lawyers in the Obama administration did not think that they could solve this problem through regulation. They thought Congress needs to pass another law that said, these people should be able to go to the exchanges and get marketplace coverage.

    But the Biden administration has looked at it again, and they think, no, this is OK, this is an acceptable way to solve this problem with this new regulation.

    It's possible that there will be some legal debate about this, some lawsuit challenging it, but it seems like the legal interpretation of the Biden administration is that they can fix this problem. And, of course, today, we saw — with President Biden, we saw President Obama was up there standing up at the podium supporting this move. So it seems like he's come around as well.

  • Amna Nawaz:

    So, we should mention there was a big Affordable Care Act expansion last year, right, part of that $1.9 trillion American Rescue Plan that also expanded health care subsidies and access to insurance.

    Those subsidies will run out at the end of this year, though, right? So does this fix help to fill the gap that that will leave?

  • Margot Sanger-Katz:

    I think it's — some of the people are the same, but many of them are not the same.

    So, lots of people are — have always been eligible since the Affordable Care Act became law. They have been eligible for subsidies to help them buy insurance. And what Congress did last year is, they gave them a little boost. They made those insurance premiums a little bit more affordable.

    For people who are close to the poverty line, really poor Americans who work, they could get a plan for free. They don't have to pay anything. And for the first time, kind of upper-middle-class people, maybe people who own their own business and buy their own insurance who were not eligible for subsidies before, they can get some financial help too.

    So, that kind of extra help, that wraparound help, that is what is set to expire unless Congress renews it. But there still will be some financial support that has been there as part of the Affordable Care Act since 2014.

  • Amna Nawaz:

    So, when you look at the Affordable Care Act, you mentioned there's kind of been patching holes as they go. Are there still big holes left to patch? Who's left out?

  • Margot Sanger-Katz:

    Yes, there are a few big holes.

    Congress tried — or Democrats in Congress were trying to patch these other big holes as part of their big Build Back Better legislation that seems to be stalled. But I would say there are two other really big groups of people who are left out.

    In about 12 states, led by Republicans for the most part, there are people who are not eligible for Medicaid coverage because their states chose not to expand Medicaid program. That was optional under Obamacare, and most states have done it, but not all. And then I do think this other group is these people who technically can get insurance through the Obamacare marketplaces, but they have just found it to be unaffordable. Insurance can be really expensive.

    And so these wraparound subsidies were really designed to help them.

  • Amna Nawaz:

    So, we should use former President Obama's appearance to ask you this one big question, which is, we have just marked 12 years since the passage of this massive health reform law.

    Did it do what it say — what it said it would do?

  • Margot Sanger-Katz:

    I think it did a lot of what it said it would do.

    I mean, there's just no doubt that it has expanded insurance coverage across this country to millions and millions of Americans who didn't have the ability to get insurance before. It's also changed the nature of health insurance. If you have a preexisting condition, you don't have to worry about being left out in the cold. If you have an employer plan, you don't have to worry about an annual cap on how much your benefits will cover.

    There were changes to Medicare as well that improved the affordability of prescription drugs. So I do think this is a large law that's had a very large impact on Americans' lives. And I think, in many ways, it's become so built into the way that we think about our health care system.

    I often talk to students, and they don't even believe that there was a time when you couldn't get insurance if you had a preexisting condition. So, I think it has done a lot. But I do think there still are millions of Americans who don't have health insurance. There are millions more who have health insurance, but really still struggle to pay their medical bills when they get sick, when their family member gets sick.

    Their health insurance may not be as comprehensive as they would like it to be.

  • Amna Nawaz:

    And we know health care remains top of Americans' minds, among all the other issues.

    Margot Sanger-Katz of The New York Times, thanks so much for joining us.

  • Margot Sanger-Katz:

    Thank you.

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