Should the American Health Care Act's Health Insurance Tax Credits be Eligible for Use on COBRA Continuation Coverage? (H.R. 2579)
Do you support or oppose this bill?
What is H.R. 2579?
(Updated August 8, 2019)
(Updated 2/12/2018): The Senate is using this bill as the legislative vehicle for legislation produced through an open amendment process, meaning that its text is going to be replaced in its entirety. In its original form the bill would have allowed premium assistance tax credits to be used for unsubsidized COBRA continuing health coverage, a program which allows an individual to keep their coverage under an employer-sponsored health plan after an event that’d otherwise end their coverage — like termination of employment. For the coverage to qualify for the tax credit, the plan administrator of the group health plan must certify that the COBRA continuation coverage meets the requirements for qualified health plans.
COBRA continuation coverage would include continuation coverage provided under:
The Internal Revenue Code, the Employment Retirement Income Security Act of 1974 (ERISA), the Public Health Service Act, or the Federal Employees Health Benefits Program;
A state law or program that provides comparable coverage;
A church plan that provides comparable coverage.
The coverage would not include coverage under a health flexible spending arrangement.
This legislation is contingent on the enactment of the American Health Care Act of 2017, and would take effect (if at all) after December 31, 2019.
Argument in favor
People who want to enroll in COBRA continuation coverage after losing their job or have their hours cut should be able to do so with the help of the AHCA’s health insurance tax credits.
Argument opposed
This bill would only become law if the AHCA were to be enacted, and as a result it should be opposed even if tax credits for COBRA continuation coverage would be helpful.
Impact
People who qualify for COBRA continuation coverage; employers.
Cost of H.R. 2579
The CBO anticipates that enacting this bill could affect spending or revenues, but that it’s unable to estimate its cost because it relies the on the enactment of other legislation.
Additional Info
In-Depth: In explaining the rationale for this bill, House Majority Leader Kevin McCarthy (R-CA) wrote in a blog post:
“The Broader Options for Americans Act makes sure people don’t fall through the cracks by expanding access to American Health Care Act tax credits to those who receive COBRA (Consolidated Omnibus Budget Reconciliation Act of 1985) continuation coverage. This way, people who lose their jobs, have their have their working hours reduced, or others who would receive COBRA continued coverage won’t be faced with overly expensive health care options.”
In the bill’s committee report, Democrats blasted it for not fixing the underlying “harm and inadequacies” in the American Health Care Act. They contend the AHCA’s tax credits “are unlikely to provide meaningful assistance for the individual market or for COBRA plans.”
This legislation passed the House Ways and Means Committee on a vote of 23-15.
Media:
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House Majority Leader Kevin McCarthy (R-CA) Press Release
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Committee Report
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CBO Cost Estimate
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The Hill
Summary by Eric Revell
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