If Donald Trump wins the White House, he’s less likely to support renewing tax credits for Americans to buy health insurance and that’s going to hit older adults who buy individual Obamacare coverage the hardest, a new study shows.
There’s been record enrollment for individual coverage purchased on exchanges under the Affordable Care Act in part because the tax credits have continued and been enhanced to more Americans under the Biden-Harris administration. And that has helped such coverage, also known as Obamacare, to hit record enrollment of more than 20 million Americans this year.
But Trump, the Republican party’s nominee for president, has said he wants to get rid of the ACA and also said more recently it’s “too expensive” through he never offers solutions on how he would improve or replace the landmark legislation signed into law by President Obama in 2010. Meanwhile, Republican members of Congress have said they would try to reduce or bring an end to the tax credits, which expire next year.
The issue of Trump’s opposition to the Affordable Care Act and GOP disdain for expanding health coverage could arise during Tuesday night’s presidential debate between the former Republican president and the Democratic nominee for president, Vice President Kamala Harris, who supports the ACA and enhanced subsidies.
The so-called “enhanced premium tax credits” have reduced monthly premium payments for millions of individuals and families since 2021.
A new report from the Robert Wood Johnson Foundation-funded Urban Institute says Americans with annual incomes of about $60,000 or more, “those aged 50+ stand to see the greatest cost-savings from healthcare tax credits that lower monthly payments for consumers.”
“The tax credits lowered average out-of-pocket premium payments by 60% for 64-year-olds and 57% for 60-year-olds,” the Urban Institute said in statement accompanying their report, which was released Monday. “Conversely, the tax credits lowered payments for 30-year-olds by just 3%.”
Though Harris holds a narrow lead among Americans overall in most national polls, Trump does slightly better among people over the age of 50. As one example, an analysis out earlier this week produced by ABC News by Langer Research Associates shows Trump has “52% support among all 50- to 64-year-olds (his best age group) and 56% among likely voters in this group.”
Thus, there’s likely Republicans among his supporters who stand to get smacked with higher health insurance premiums if the enhanced tax credits expire at the end of 2025. The credits were originally approved by the then Democratic-controlled Congress as part of the American Rescue Plan Act, which was signed into law in 2021 by President Biden. Not a single Republican voted for the American Rescue Plan Act.
“Without the tax credits, an average 60-year-old with an annual income of roughly $60,000 would have to spend 20% of their annual earnings on health insurance premiums,” the Urban Institute said. “A 60-year-old with an individual income of just over $75,000 would have to spend 16% of their income on premiums.”
Losing the tax credits could force some Americans to drop coverage altogether, Urban Institute researchers said. “If the enhanced credits are allowed to expire after 2025, many Marketplace enrollees, particularly older adults and those in high-cost states, would face extremely high out-of-pocket premiums forcing many out of coverage,” Jessica Banthin, senior fellow at the Urban Institute, said in a statement accompanying the report.
The enhanced premium tax credits have been reducing monthly premium payments for “millions of individuals and families since 2021,” the Urban Institute said.
The tax credits help older adults most. “30-year-olds saw an average credit of $13 per month but 64-year-olds saw an average credit of $654 per month,” Urban Institute data shows.
“Healthcare needs increase with age, and so does the importance of the enhanced premium tax credits,” said Katherine Hempstead, senior policy adviser at the Robert Wood Johnson Foundation. “Without these credits, many older adults would have to spend an unacceptably large share of their income on premiums, resulting in difficult tradeoffs between healthcare and other necessities like food and housing. It is clear that tax credits provide significant financial relief to older adults, and any rollback would impose a substantial burden.”
