In Montana, more than 47,000 people qualify for tax credits that lower their monthly health insurance premiums. Those tax credits were created by the Affordable Care Act, what some people call Obamacare. Many of those people would see big changes if the Republican healthcare bill in the works in Congress now becomes law.
For example, under Obamacare, a 60-year-old person in Missoula county who makes $30,000 a year can get a little over $10,000 a year in tax credits to help make health insurance affordable.
"That compares to the House GOP plan which would provide a $4,000 tax credit, so that's about a 61 percent decrease in support," says Heather O’Loughlin, co-director of the Montana Budget and Policy Center, a non-partisan research organization that advocates for low income families.
She says the Republican bill – as it was introduced - rolls back tax credits for lower income people, but expands them to people with higher incomes who don’t get tax credits now.
Eric Whitney: So, under the Republican plan, individuals making more than $65,000 who don’t get credits now would get tax credits?
O'Loughlin: "That’s right. Somebody with incomes over $80,000 who don’t necessarily receive tax credits under the Affordable Care Act may now receive somewhere around $3,000 under the House plan."
The tax credits in both the Affordable Care Act and the Republican proposal only apply to people who buy health insurance in the individual market. In Montana and the rest of the U.S., most people get coverage from other sources, like through their jobs.
In Montana, the biggest slice of the insured population gets coverage through their jobs (46%), followed by Medicare (20%) and Medicaid (19%). Fewer than 10 percent of Montanans (8%) buy coverage in the individual market, and of them, roughly three-fifths qualify for a tax credit under Obamacare that lowers their monthly bills. All these statistics are from the state insurance commissioner’s office.
"Under the Affordable Care Act, the tax credits can reduce the costs pretty significantly, particularly for families who are living below or near the poverty line," O'Loughlin says.
Affordable Care Act tax credits are pegged to the federal poverty line. People with lower incomes get bigger tax credits. People who make more money get less help. And the most someone can make and still get a tax credit is around $65,000 a year.
The tax credits would change significantly under the Republican plan, O’Loughlin says:
"It's not tied to income, necessarily, but simply tied to a certain set amount at various levels."
EW: And those are tied to age brackets? Like, if you’re in your 40s you'll get one subsidy, if you’re in your 50s or 60s you’ll get a higher subsidy?
"That’s right, so those are tied to age," says O'Loughlin.
The net result is that most people getting subsidies now will see the amount of help they're getting go down. And, some people who currently make too much money to get tax credits would start getting them under the Republican plan.
"Yeah, and again, we're certainly seeing the greatest change or reduction in assistance to those who have lower incomes and older Montanans," O'Laughlin adds.
Republican leaders have been making changes to their bill, and it’s unclear exactly how those will impact specific demographic groups, but an analysis by the Washington, DC-based Center on Budget and Policy Priorities says the proposed legislation still cuts tax credits and raises costs for millions of Americans.