Proposed deal to end shutdown omits subsidies for health insurance plans as Dems demanded

The proposed agreement to end the government shutdown does not include what had been the Democrats’ main demand: That subsidies that lower the cost of health insurance purchased under the Affordable Care Act be extended.

Democrats had for weeks insisted on a permanent extension of subsidies that were adopted in 2021 and were scheduled to expire on Dec. 31. The 2021 law increased existing ACA tax credits and raised the income ceiling on who qualified for government assistance to include many middle-income people. Last week, Democrats offered to compromise and accept a one-year extension of the subsidies, but Republicans rejected the offer.

If the more generous tax credits expire, about 28,000 Long Islanders would pay an average of 32% more for health insurance premiums, according to state Department of Health data.

The proposed agreement would allow a Senate vote on subsidies next month, although it’s unclear whether it would pass. Even if the measure passed, whether House Speaker Mike Johnson (R-La.) would permit a vote in his chamber remains unclear.

Another 70,000 Long Islanders would be affected by any loss of enhanced subsidies as of July 1. They currently are covered under a state program that receives federal funding that grants $0 premiums to people who fall  between 200% and 250% of the federal poverty level — currently between $31,300 and $39,125 a year for an individual. President Trump’s “Big Beautiful Bill” ended federal funding for that program, but those residents would be eligible for ACA subsidies — although their tax credits would be lower if the 2021 expansion is not extended.

By David Olson

david.olson@newsday.com@DavidOlson11

David Olson covers health care. He has worked at Newsday since 2015 and previously covered immigration, multicultural issues and religion at The Press-Enterprise in Southern California.