H.R.247 - Health Care Affordability Act of 2025 (119th Congress)
Summary
H.R.247, the "Health Care Affordability Act of 2025," aims to amend the Internal Revenue Code of 1986 to expand eligibility for the refundable credit for coverage under a qualified health plan. The bill seeks to remove the income cap of 400 percent of the poverty line for eligibility and adjust the applicable percentages used to calculate the credit amount. This adjustment would provide subsidies to individuals and families with incomes above this threshold.
The bill modifies section 36B(c)(1) and 36B(b)(3) of the Internal Revenue Code, altering the income tiers and applicable percentages for determining the premium assistance credit. The changes are set to take effect for taxable years beginning after December 31, 2025.
Ultimately, the goal is to make health insurance more affordable for a broader range of Americans by increasing access to premium tax credits.
Expected Effects
The primary effect of H.R.247 would be to increase the number of individuals and families eligible for financial assistance in purchasing health insurance through the Affordable Care Act (ACA) marketplaces. By removing the income cap, those with higher incomes would become eligible for subsidies.
The revised applicable percentages would also lower the cost of premiums for many who already qualify for the credit. This could lead to increased enrollment in qualified health plans and potentially improve access to healthcare services.
However, the expansion of eligibility could also increase the overall cost of the premium tax credit program, potentially impacting the federal budget.
Potential Benefits
- Increased Access to Healthcare: More individuals and families, particularly those with incomes above 400% of the poverty line, would gain access to affordable health insurance.
- Lower Premiums: The revised applicable percentages could reduce the financial burden of health insurance premiums for many Americans.
- Improved Health Outcomes: Increased access to healthcare coverage could lead to better preventative care and management of chronic conditions.
- Financial Security: Reduced healthcare costs can improve the financial stability of households, preventing medical debt and financial hardship.
- Greater Equity: By expanding eligibility, the bill could address disparities in healthcare access based on income.
Potential Disadvantages
- Increased Federal Spending: Expanding eligibility for premium tax credits would likely increase federal spending, potentially adding to the national debt.
- Potential Tax Increases: To offset the increased costs, the government might need to raise taxes or cut spending in other areas.
- Market Distortions: Subsidies can distort the health insurance market, potentially leading to higher overall premiums in the long run.
- Complexity: The changes to the Internal Revenue Code could add complexity to the tax system, making it more difficult for individuals to understand and comply with.
- Uncertainty: The long-term effects of the bill on the health insurance market and the federal budget are uncertain and could vary depending on economic conditions and other factors.
Most Disadvantaged Areas:
Constitutional Alignment
The bill's alignment with the U.S. Constitution primarily relates to the "general Welfare" clause of the Preamble, which empowers the government to promote the well-being of its citizens. Additionally, Article I, Section 8, Clause 1 grants Congress the power to lay and collect taxes to provide for the general welfare of the United States.
However, some may argue that the expansion of government subsidies for healthcare could be seen as an overreach of federal power, potentially infringing on individual liberty and economic freedom. The constitutionality of the Affordable Care Act, which this bill amends, has been previously challenged and upheld by the Supreme Court.
Ultimately, the constitutionality of H.R.247 would likely depend on how the courts interpret the scope of the federal government's power to regulate healthcare and provide for the general welfare.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).