WASHINGTON, DC –Today, The Hill ran an Op-ed by Joint Economic Committee Chairman David Schweikert on Congress’ misguided focus on subsidizing healthcare instead of looking at innovative solutions that reduce costs and help people become healthier. This Op-ed follows on a recent brief released by the JEC entitled “Long Overdue: Enhance Premium Tax Credits Should Expire.”

Stop propping up sickness and start propping up health

by Rep. David Schweikert (R-Ariz.), opinion contributor

For too long, the debate over America’s health care system has been about financing ever-increasing prices instead of encouraging solutions that reduce costs. Every health care discussion in Washington now centers on who pays the bill rather than on how to make people healthier.

The latest example of this is the push to make the COVID-era premium subsidies, formally known as “enhanced premium tax credits,” a permanent part of the Affordable Care Act.

These subsidies were enacted as temporary emergency relief during COVID. Instead, some in Congress are seeking to make them a permanent mechanism for financing higher insurance costs, enriching large insurers while doing little to improve health outcomes.

The Joint Economic Committee, in its latest brief, “Long Overdue: Enhance Premium Tax Credits Should Expire,” confirmed what many of us have suspected. Federal spending on these subsidies has exploded since 2021, providing a financial boon for insurers while doing very little to improve health outcomes.

Even if the subsidies expire as scheduled, total spending on Affordable Care Act subsidies in 2026 will remain more than double what was projected before the pandemic. Yet despite all that spending, Americans aren’t getting healthier. When adjusted for the pandemic’s disruption, life expectancy remains flat, as do obesity rates. Chronic disease rates also remain stubbornly high.

That’s because these subsidies don’t actually focus on improving health or lowering the cost of care. When taxpayers pick up nearly the entire tab insurers face little incentive to restrain premiums. As the share of consumers paying little to nothing in premiums has increased to 42 percent, consumer responsiveness to price has collapsed, and insurers have capitalized by hiding increases in gross premiums. The result is a ratcheting subsidy model that drives up costs without changing the underlying price of medical services. It is a cycle that rewards inefficiency and punishes innovation.

To read the full Op-ed, please click here. 

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