Dive Brief:
The Senate took a key step on Sunday towards ending the longest government shutdown in history, voting 60-40 to move forward on a spending agreement that does not include an extension of more generous Affordable Care Act subsidies.
Eight Democrats broke with their party to vote with Republicans, arguing that the shutdown had become too harmful to the American people. The defections were met with anger from some of their colleagues, given preserving the subsidies was Democrat’s chief demand in shutdown negotiations.
Along with funding the government through January, the deal would also ensure furloughed federal workers receive back pay and that employees laid off during the shutdown will regain their jobs. Both chambers have to pass the agreement and President Donald Trump must sign it into law before the government is officially reopened.
Dive Insight:
The government has been inactive for 41 days, putting food benefits at risk for millions of people, grounding thousands of flights and furloughing hundreds of thousands of federal workers, including at the HHS.
Despite weeks of negotiations in the Senate, lawmakers have been unable to break gridlock over a key health policy issue driving the shutdown: the future of expanded tax credits for ACA plans. The enhanced subsidies, which are set to expire at the end of the year, have helped millions of Americans afford coverage on the exchanges.
But late Sunday, the Senate voted yes on a procedural motion to move forward with an agreement to fund the government. The deal as it stands would not extend the enhanced subsidies. Instead, it allows for the Senate to vote on them later in the year, which proponents of the agreement argue is the only path forward given many Republicans refused to negotiate on the subsidies until the government is reopened.
“We must extend the ACA enhanced premium tax credits, but that can’t come at the expense of the millions of Americans across our country impacted by a shutdown,” Sen. Catherine Cortez Masto, D-Nev., said in a statement on her vote backing the agreement.
However, other Democrats said the lack of movement on the subsidies makes supporting the deal impossible.
“America is far too expensive. We will not support spending legislation advanced by Senate Republicans that fails to extend the Affordable Care Act tax credits. We will fight the GOP bill in the House of Representatives,” said House Minority Leader Hakim Jefferies, D-N.Y., in a statement on Sunday.
Republicans have committed to a vote on the tax credits in December. However, that’s no guarantee that an extension will be passed. And even if an extension clears the Senate, it faces a sharp uphill battle in the House — and a perennial critic in President Donald Trump, who spent the weekend posting on social media that the ACA is broken and that federal dollars should be directed away from “BIG, BAD” and “money sucking” insurance companies.
“NO MORE MONEY, HUNDREDS OF BILLIONS OF DOLLARS, TO THE DEMOCRAT SUPPORTED INSURANCE COMPANIES FOR REALLY BAD OBAMACARE. THE MONEY MUST NOW GO DIRECTLY TO THE PEOPLE, TAKING THE ‘FAT CAT’ INSURANCE COMPANIES OUT OF THE CORRUPT SYSTEM OF HEALTHCARE,” Trump wrote in an all-caps post on Truth Social on Saturday.
“THE PEOPLE CAN BUY THEIR OWN, MUCH BETTER POLICY, FOR MUCH LESS MONEY, SAVING, FOR THEMSELVES, AN ABSOLUTE FORTUNE!” the president continued.
In similar posts the next day, Trump clarified that he wants the government to send money directly to Americans’ health savings accounts. Republicans are big fans of the tax-advantaged accounts, which can cover qualifying medical expenses, arguing they give consumers more choice and control over their healthcare.
Last week, Sen. Bill Cassidy, R-La. and the chair of the Senate health committee, proposed funneling ACA tax credit dollars into flexible spending accounts for eligible enrollees.
However, details are scant about how Trump’s actual proposal would play out. Democrats scorned the idea.
“This is, unsurprisingly, nonsensical,” Sen. Chris Murphy, D-Conn., posted on X on Saturday. “Is he suggesting eliminating health insurance and giving people a few thousand dollars instead? And then when they get a cancer diagnosis they just go bankrupt?”
Despite Republican antipathy towards the ACA, voters overwhelmingly approve of extending the enhanced credits. Without them, monthly healthcare costs are set to skyrocket for the millions of low- and middle-income Americans on the exchanges, and some 4 million people will lose insurance, according to the Congressional Budget Office.
The loss of the credits will be felt most acutely in Republican districts, a source of concern for conservatives heading into a midterm year — especially after Democrats swept off-cycle elections on Tuesday in states like Virginia and New Jersey.
