THIS CHART: How GOP O’Care Plan Shifts Tax Credits From The Poor To The Rich

An analysis by the Kaiser Family Foundation published Wednesday of a GOP proposal to rework the Affordable Care Acts subsidies into tax credits available to everyone illustrates how the plan, which was leaked last week, would represent a major loss for lower-income people and older Americans. Those higher on the income scale stand to gain under such a plan.

Republican leadership is considering offering refundable tax credits that start at $2,000 annual for individuals under 30 and raise with age, up to $4,000 for those over 60. Unlike the ACA’s tax credits, they do not adjust with income, meaning a wealthy person would be getting the same break as a low income American. Obamacare’s tax credits end for people making 400 percent of the federal poverty line.

The rate at which the Republican tax credits grow by age is slower that those offered under Obamacare, meaning older people will be bearing a greater burden of their premiums under the GOP plan. Currently, under the ACA, older people can face premiums three times higher than younger people, and Republicans’ credits only double in size for those at the oldest end. GOP lawmakers have also proposed expanding the ratio for premiums for young and old people to one to five, which could further exacerbate the hit older people would take under the Republican plan.

Additionally, they are the same nationwide, meaning in areas with higher premiums, they don’t go as far. The Affordable Care Act’s subsidies are priced according to the second-lowest-cost silver plan in the area where the consumer lives, meaning that they reflect the geographical difference in average premiums.

Dear Reader,

When we asked recently what makes TPM different from other outlets, readers cited factors like honesty, curiosity, transparency, and our vibrant community. They also pointed to our ability to report on important stories and trends long before they are picked up by mainstream outlets; our ability to contextualize information within the arc of history; and our focus on the real-world consequences of the news.

Our unique approach to reporting and presenting the news, however, wouldn’t be possible without our readers’ support. That’s not just marketing speak, it’s true: our work would literally not be possible without readers deciding to become members. Not only does member support account for more than 80% of TPM’s revenue, our members have helped us build an engaged and informed community. Many of our best stories were born from reader tips and valuable member feedback.

We do what other news outlets can’t or won’t do because our members’ support gives us real independence.

If you enjoy reading TPM and value what we do, become a member today.

Latest This-chart
Comments
Masthead Masthead
Founder & Editor-in-Chief:
Executive Editor:
Managing Editor:
Associate Editor:
Investigations Desk:
Reporters:
Newswriter:
Editor at Large:
General Counsel:
Publisher:
Head of Product:
Director of Technology:
Associate Publisher:
Front End Developer:
Senior Designer: