Mar 15, 2022 - Health

Fix for Affordable Care Act's "family glitch" on the horizon

The White House exterior.

Photo: Eric Lee/Bloomberg via Getty Images

The Biden administration is reviewing a regulation that experts expect would help close the Affordable Care Act's "family glitch," according to a notice filed last week.

Why it matters: The regulation could help as many as 5.1 million people get more affordable coverage by addressing an ACA loophole.

Details: The family glitch was created by a provision of the ACA that deals with premium subsidy eligibility — and that lowballs the cost of covering a family.

  • People who are eligible for "affordable" employer health insurance aren't eligible for premium assistance on the ACA marketplaces. Affordability is defined as the premium for a single beneficiary — the employee — being below a certain percentage of family income.
  • That doesn't account for the additional costs of adding dependents to the plan. But the affordability determination is applied to all members of the household, making them all ineligible for subsidies if the premium for just one person falls below the threshold.

What they're saying: "Fixing the ACA's family glitch may be the most consequential thing the Biden Administration could do without Congress to make health insurance more affordable," KFF's Larry Levitt tweeted Tuesday.

  • Most of the people who fall into the glitch are children, per KFF estimates, and adult women are more likely to fall into it than adult men.
Go deeper