HR-4849-119
Referred to the Committee on Ways and Means, and in addition to the Committee on Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Sponsored by Adam Gray (D-CA)
What it does
This bill would permanently extend expanded Affordable Care Act (ACA) premium tax credits that are currently set to expire after 2025. It would eliminate the income cap (currently 400% of the federal poverty level after 2025) that limits who qualifies for the credit, and would lock in lower "applicable percentages" — the formula that determines how much of their income enrollees must pay — without adjusting them for inflation. The bill would also repeal several Medicaid, Medicare, and health-related tax provisions enacted by the One Big Beautiful Bill Act (OBBBA), including certain eligibility and verification requirements, a reduced window for retroactive Medicaid coverage, and premium tax credit verification requirements.
Who benefits
Current ACA marketplace enrollees who would retain larger subsidies beyond 2025. Middle- and higher-income households (above 400% of the federal poverty level) who would remain eligible for premium tax credits permanently. Uninsured individuals who may newly qualify for subsidized coverage. Health insurance exchanges and insurers who benefit from a larger, subsidized enrollment pool. Medicaid enrollees who would be protected from stricter eligibility and verification requirements enacted by the OBBBA. Hospitals and safety-net providers who treat Medicaid patients and benefit from broader retroactive coverage windows.
Who is hurt
Federal taxpayers broadly, who would bear the cost of permanently expanded subsidies. Fiscal conservatives and deficit-reduction advocates who supported the OBBBA's Medicaid and Medicare provisions. States that had begun implementing OBBBA Medicaid verification and eligibility requirements, which would face administrative disruption. Employers who compete with subsidized marketplace plans for workers, potentially facing indirect labor market effects. Taxpayers who do not use ACA marketplaces and receive no direct benefit from the expanded credits.
Supporters argue
Supporters argue that the expanded premium tax credits, first enacted in 2021, drove ACA marketplace enrollment to a record 24 million people in 2024 — a 30% increase — demonstrating measurable demand for affordable coverage. They contend that allowing these credits to expire after 2025 would cause millions of Americans to lose coverage or face sharply higher premiums, and that making them permanent provides the long-term stability that individuals, families, and insurers need to plan. They further argue that repealing the OBBBA's Medicaid and Medicare provisions restores coverage protections for low-income Americans that were reduced without sufficient evidence of fraud savings to justify the coverage losses.
Opponents argue
Opponents argue that permanently expanding premium tax credits with no income ceiling creates an open-ended federal subsidy with no fiscal guardrails, adding trillions to the deficit over time — a concern amplified by the Congressional Budget Office's prior estimates that the temporary expansion cost roughly $200 billion over five years. They contend that the OBBBA's Medicaid verification and eligibility provisions were designed to reduce improper payments and ensure program integrity, and that repealing them removes accountability measures without addressing documented enrollment errors. They further argue that permanently eliminating the inflation adjustment for applicable percentages locks in a subsidy structure that will grow increasingly costly as health care prices rise.
Constitutional context
The premium tax credit is structured as a refundable tax credit under the Taxing and Spending Clause (Art. I, §8, cl. 1), which grants Congress broad authority to tax and spend for the general welfare. NFIB v. Sebelius (2012) affirmed Congress's authority to structure ACA-related provisions as taxes. The Origination Clause (Art. I, §7, cl. 1) requires revenue bills to originate in the House; this bill was introduced in the House, satisfying that requirement.
Checks and balances
Congress would expand and make permanent the premium tax credit and repeal OBBBA provisions; the IRS administers the credit and would implement any new verification rules; the executive branch (HHS and CMS) administers Medicaid and Medicare, and courts retain authority to review any eligibility or verification disputes.
Historical precedent
The American Rescue Plan Act of 2021 first enacted the expanded premium tax credits on a temporary basis, and the Inflation Reduction Act of 2022 extended them through 2025; this bill would make those expansions permanent rather than allowing them to sunset.