January 22, 2024

Reps. Levin and Sanchez Lead New Bill to Lower Health Care Premiums for Households Enrolled in Medicare and Affordable Care Act Plans

Washington, D.C. – Today, Reps. Mike Levin (CA-49) and Linda Sanchez CA-38) introduced H.R. 7017, the Health Insurance Premium Fairness Act, to help lower health care insurance premiums for households enrolled in Medicare and Affordable Care Act (ACA) plans. The bill would close a loophole that penalizes married couples when one spouse ages into Medicare and the other spouse remains on an ACA marketplace plan.

The ACA premium tax credit caps how much someone with an ACA plan pays for premiums based on their household income. However, if a household member ages into Medicare, the ACA tax credit formula no longer takes the premiums that person now pays to Medicare into account. Therefore, the household premiums for an ACA plan may increase by potentially thousands of dollars a year. This bill ensures that the Medicare premiums count towards the cap in monthly premiums.

The bill would adjust the premium tax credit formula to subtract Medicare premiums from the maximum premium paid for an ACA marketplace plan. This ensures that households continue to pay no more than a capped percentage of their income in premiums, aligning with the original intent of the ACA to maintain affordability for those with dual coverage.

“American families should not be penalized when one household member becomes eligible for Medicare and the other remains on an ACA plan,” said Rep. Levin. “This bill would help older couples afford their health insurance by closing a loophole in the ACA premium tax credit formula and fix an issue that thousands of enrollees may not know about. This year a record number of Americans – 20 million – signed up for an ACA plan, and they should have the peace of mind that they will not have to pay more in premiums if a spouse ages into Medicare. I’ll keep fighting to ensure everyone is able to access the quality, affordable health care they deserve.”

“With a record number of Americans choosing ACA coverage this past year, couples should not have to worry when one spouse ages into Medicare and the other spouse remains insured through an ACA marketplace plan. This bill will fix an existing loophole in the premium tax credit systems, and ensure older American couples have stable premiums and affordable health insurance,” said Rep. Sánchez. “I’m proud to join my colleague in building on the successes of the Affordable Care Act and the work Democrats did to make healthcare more affordable through the Inflation Reduction Act. This bill continues to make healthcare more accessible for working families in this country.”

Rep. Levin first became aware of this loophole when he was contacted by his constituent, Ted DeBont of Encinitas, CA.

“My wife and I were both enrolled in an Affordable Care Act marketplace insurance plan via Covered California, but when I went on Medicare in the Fall of 2021, a loophole in the ACA’s premium cost calculator caused our overall insurance costs, including all Medicare costs, to rise from approximately $300 per month to over $600 per month,” said Ted DeBont. “I knew we couldn’t be the only folks facing this dilemma. I’m grateful to Rep. Levin and his team for meeting with me to hear about our situation and for introducing a bill that would save us—and many folks like us—thousands of dollars per year.”

“Democrats like Representatives Mike Levin and Linda Sanchez are keeping up the momentum to lower health care costs for the American people. The Health Insurance Premium Fairness Act builds on the Inflation Reduction Act's historic measures to lower premium costs for families, which has contributed to record enrollment on the ACA marketplaces,” said Protect Our Care Chair Leslie Dach. “This bill gives Americans, especially seniors, more breathing room to pay for other necessities like groceries and rent, while former President Trump and Republicans in Congress are threatening to repeal affordable health care. At a time when more people are depending on affordable coverage through the ACA marketplaces than ever before, legislation like this will lower costs and further improve the health and well-being of families nationwide.”

Since taking office in 2019, Rep. Levin has made increasing access and lowering health care costs a priority in Congress. In 2021, Rep. Levin was proud to join House Democrats in helping to pass the American Rescue Plan Act, which expanded and increased the ACA premium tax credits during the COVID-19 pandemic. He then voted for the Inflation Reduction Act, which extended the expanded premium tax credit through 2025.

This bill is endorsed by: Protect Our Care, Alliance for Retired Americans, National Committee to Preserve Social Security & Medicare, Families USA, Justice in Aging, Social Security Works, Center for Medicare Advocacy, Protect Our California, and California Alliance for Retired Americans.

The text of the bill can be found here.

A one-pager fact sheet of the bill can be found here.