A time-honored political trick is to pass a “temporary” subsidy that people get used to and then cry hardship when the emergency program ends. The latest example is the Democratic scramble to make permanent a huge ObamaCare subsidy expansion passed during the pandemic.
More than two dozen Democrats wrote their leaders this month asking to include provisions to “permanently lower the cost of health care” in any reconciliation bill, and the signers include some in tough re-election races such as Abigail Spanberger from Virginia.
The lawmakers are referring to expanded subsidies to buy ObamaCare plans, passed in 2021 and set to expire at the end of the year. If the subsidies aren’t extended, the letter warns, enrollees will soon see premium increases. No doubt Democrats are worried about the political consequences, but this is a subsidy cliff of their own design.
The American Rescue Plan Act juiced subsidies for ObamaCare, and those earning more than 400% of the federal poverty line became eligible, depending on the cost of a “benchmark” plan. A family of four with a 60-year-old head of household earning $265,000 could end up eligible for more than $7,800 a year in taxpayer subsidies.