Thousands of Alaskans face potential disruptions to their health insurance coverage beginning January 1, as federal subsidies enacted during the pandemic are set to expire. The looming changes could force many to pay significantly more for their plans or go without coverage altogether.
Enhanced premium tax credits, first implemented in 2022 to make health insurance more affordable during the COVID-19 pandemic, are slated to end this year. Roughly 25,000 Alaskans currently rely on these credits to afford plans purchased through the Affordable Care Act marketplace.
A Looming Financial Cliff
Alaska’s U.S. Senators, Lisa Murkowski and Dan Sullivan, have been working for months to extend the subsidies, even while acknowledging they haven’t substantially curbed rising healthcare costs in the state. Despite their efforts, the Senate failed to reach an agreement, creating what some are calling a “price cliff.”
The expiring enhanced credits are layered on top of existing, but more limited, premium tax credits. This creates a situation where Alaskans could suddenly face a substantial increase in premiums if their income exceeds the threshold for the remaining subsidies.
Jeigh Stanton Gregor, a licensed counselor and member of the Petersburg Borough Assembly, described the difficult position he faces. “We’ve decided that unless Congress does change that, we will have to stay away from that financial cliff edge, and just see less people,” he said. “I’ll tell my patients: ‘I’m sorry, I can’t see you as much, because I need to afford health care for my family.’”
Stanton Gregor currently pays approximately $900 per month in premiums. Without the subsidies, his Premera Blue Cross plan would jump to around $3,500 per month. He plans to limit his patient load to ensure his income remains below the $160,000 annual gross income threshold to qualify for the remaining subsidies.
“I have to limit my mental health services to people in this community to afford health care,” he said.
Congressional Democrats attempted to pressure their Republican colleagues during government shutdowns in October and November to extend the subsidies. Stanton Gregor said he “was hoping against hope” that the shutdown – which became the longest on record – would result in an extension. However, the shutdown ended without a resolution, aside from a promise of a December vote on a Democratic proposal. That vote failed, even with support from Senators Sullivan and Murkowski, due to opposition from most Republicans.
“I was really bummed that did not get addressed,” Stanton Gregor added.
Nan Schleusner, a human resources consultant in Anchorage, said her monthly premium of $1,380 for her family of three would increase to roughly $4,300 next year for the same plan.
Schleusner described the failed Senate vote as “a big middle finger for people like me.”
The December 15 deadline to enroll in coverage beginning January 1 has passed, meaning those relying on ACA marketplace insurance have already locked in their plans for the first month of the year. However, some in Congress are holding out hope for a secondary deadline of January 15 for coverage beginning February 1.
Schleusner expressed hope that Congress will extend the tax credits next month. “I know that it can happen, but at this rate, I’m very doubtful it will happen,” she said. “It feels like both sides are talking past each other, versus trying to solve the problem.”
Senator Murkowski’s spokesperson, Joe Plesha, stated this week that the senator “has not given up.”
“She has remained actively engaged in negotiations over the holidays to extend the enhanced premium tax credits and prevent a sharp increase in health care costs for families across the country,” Plesha said in a statement, adding that “Murkowski will continue pressing leadership, the White House, and her colleagues to act quickly.”
Senator Sullivan said earlier this week he is still working with colleagues on a potential compromise. “I literally was working on it with some Senate colleagues today,” Sullivan said in an interview Tuesday. “There’s got to be compromise on both sides of the aisle.”
Sullivan has advocated for a short-term extension of the credits alongside new income limits. He is up for reelection in November and suggested the outcome depends on the approach of Senate Minority Leader Chuck Schumer. “Does he want to get to a compromise position, or does he want to use this as a campaign issue next year?” he asked.
Alaska’s U.S. House member, Nick Begich, has remained silent on the issue of extending the health care subsidies, which are opposed by leaders of his caucus. He declined to answer multiple questions from the Daily News and did not participate in efforts by some of his moderate GOP colleagues to push for a vote on extending the subsidies before the holiday recess.
In a statement earlier this month, Begich blamed the Affordable Care Act for rising costs and praised a House GOP health care bill that did not extend the subsidies. That bill passed the House but was not considered in the Senate.
“We must now construct a system that delivers results — a system where Americans can honestly say they are getting their money’s worth,” Begich said in a statement.
Mark Robokoff, a pet supply shop owner in Anchorage, said he “threw up his hands” after considering his options. He will be paying close to $3,000 per month beginning in January, for a plan that previously cost him under $1,000 per month.
“I feel pretty abandoned by our government on this,” he said.
