House centrists are discussing the outlines of a possible compromise to extend Affordable Care Act insurance subsidies in hopes of jump-starting stalled talks over the soon-to-expire tax credits that have also emerged as a key fault line in the brewing government shutdown battle.
The bipartisan Problem Solvers Caucus has privately broached whether an income cap should be imposed on who can benefit from the subsidies. Several Republicans in the group have floated a $200,000 cap, according to three people granted anonymity to describe the talks.
More than 20 million Americans currently benefit from the enhanced subsidies, which were enacted by Democrats under President Joe Biden in 2021. Some Republicans are now open to extending them, though many are pushing for new curbs to bring down the cost. The income cap is a bare minimum demand for many Republicans.
Democrats, meanwhile, are pushing for a permanent extension as part of government funding talks ahead of the Sept. 30 shutdown deadline. Some centrist Democrats have been willing to discuss concessions, though they are wary of publicly supporting any new limitations at this point.
After a pair of dueling partisan funding bills failed in the Senate last week, members of the Problem Solvers’ executive board discussed Monday how a potential compromise on the insurance subsidies could fit into a bipartisan agreement to address a government shutdown, according to two other people with direct knowledge of the meeting.
Top Republican leaders have ruled out dealing with the ACA subsidies as part of any deal to avert an Oct. 1 shutdown, saying it’s an issue to deal with in November or December.
But Rep. Brian Fitzpatrick (R-Pa.), co-chair of the Problem Solvers Caucus, pushed back on that timeline in an interview last week.“That can’t happen,” Fitzpatrick said. “We’re up against a real deadline. The rates are going to kick in probably Nov. 1. So we have October to get it done.”
The Problem Solvers group has yet to settle on any restrictions beyond a clean one-year extension bill that is led by Rep. Jen Kiggans (R-Va.) and Tom Suozzi (D-N.Y.) and backed by several other members of the caucus.
Beyond the income cap, some more conservative House Republicans have floated other restrictions — such as grandfathering in current beneficiaries but cutting off access for new enrollees, or forcing some enrollees to pay a minimum out-of-pocket premium — according to three other people granted anonymity to describe the conversations. Another section of GOP hardliners want to completely axe the subsidies, providing another wrinkle for GOP leaders to work through as centrists raise concerns about the fallout in their districts.
Fitzpatrick — a member of the Ways and Means Committee, which has jurisdiction over the subsidies — confirmed that the income cap and other reforms have come up in private talks with centrist House lawmakers over an extension.House Democrats, meanwhile, generally want a longer extension with fewer limitations on enrollees. Even Democrats in the Problem Solvers Caucus caution they haven’t agreed to anything or seriously discussed the details of an income cap. Any final agreement, they note, will have to be negotiated and blessed by top congressional leaders.
If an extension deal can’t be struck quickly around the shutdown standoff, Fitzpatrick and other worried Republicans are planning to push for passage of a standalone bill in October before insurers start to lock in pricing for 2026.
“A lot of our folks back home are talking about this,” he added. “It’s a big, big deal.”
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