Representative Angie Craig Applauds Biden Administration Step Toward Closing the Family Glitch in the Affordable Care Act

Statement

Today, U.S. Representative Angie Craig applauded the Biden Administration's progress toward fixing the "family glitch" in the Affordable Care Act's subsidized marketplace coverage -- a step that could save 62,000 Minnesotans thousands of dollars annually on their health insurance premiums. The Administration recently submitted a proposed rule change to the Office of Management and Budget for review, a necessary step toward officially addressing the issue.

Craig has prioritized fixing the glitch in the 117th Congress -- which has resulted in some Minnesota families paying nearly a quarter of their household income on premiums due to a longstanding gap in eligibility for the Affordable Care Act's subsidized marketplace coverage. Last year, Craig repeatedly called on the Biden Administration to resolve the glitch arguing that such a step would align with President Biden's commitment to lowering out-of-pocket health care costs for the American people.

"In Congress, I've worked tirelessly to support and strengthen the Affordable Care Act -- and to take steps that would lower out-of-pocket health care costs for American families," said Representative Craig. "Today, I am relieved to see the Biden Administration taking the first step toward fixing the "family glitch,' which has made health care unaffordable for more than 5 million families nationwide. This proposed change would provide long overdue relief for thousands of Minnesotans -- and I encourage the Biden Administration to enact it as soon as possible."

The family glitch originated from a 2013 Internal Revenue Service and Department of Treasury rule, which determined that families are ineligible for financial assistance if a family member is offered "affordable" employer coverage. In 2021, the affordability threshold was 9.83%, which means that an individual qualifies for subsidized marketplace coverage if their employer health insurance premiums exceed 9.83% of household income. However, this threshold does not take into account the cost of covering the rest of the household, which can make coverage prohibitively expensive for many families.

A recent analysis estimated that 5.1 million people nationwide are impacted by the family glitch, including 62,000 Minnesotans. In Minnesota, the average annual premium for an individual is $6,904 and the average annual family premium is $20,751. Under the glitch, a family with a household income of $85,000 would not qualify for premium tax credit assistance even if they paid the average family total, which would amount to more than 24% of their household income.

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