Federal shutdown: Nearly 100,000 Long Islanders' health care costs impacted by debate

Hanging in the balance as the federal government shutdown entered its ninth day Thursday are health insurance plans for nearly 100,000 Long Islanders, some of whom could face thousands of dollars in premium increases if government subsidies aren’t extended on Jan. 1.

One of the key sticking points in the shutdown is a Democratic demand that enhanced federal subsidies for the Affordable Care Act — also known as Obamacare — that were first enacted in 2021 be extended past their expiration date and made permanent. Democrats also are asking for the reversal of Medicaid changes that would, according to independent analyses, lead to cuts of hundreds of billions of dollars in Medicaid spending.

On Long Island, the average increase for about 28,000 people with subsidized ACA plans would be 32%, according to data from the state Department of Health. Another 70,000 who now pay no premiums will have to pay something no matter what — but more without a subsidy extension.

"Millions of low- and middle-income Americans are facing a looming health care affordability crisis," Sen. Kirsten Gillibrand (D-N.Y.) said in a virtual news conference Wednesday. Republican lawmakers, meanwhile, said discussions about extending the subsidies shouldn't be tied to the shutdown, and some support proposals to temporarily extend the aid.

Many of those who receive government help with their health insurance premiums under the 2021 changes are middle class families with household incomes in the six figures. But with housing, property taxes and other costs so high on Long Island, those families would struggle to pay hundreds of dollars each month in market-rate health insurance premiums, said Vanessa Baird-Streeter, president and CEO of the nonprofit Health and Welfare Council of Long Island.

"These are our middle-income individuals that either do not have health insurance through their employer, because the employer is small, or they are an independent contractor, or they just have subpar insurance through their employer, and they want to ensure that they have the appropriate insurance to address their health issues," she said.

The ACA has always subsidized premiums for people below certain incomes. The 2021 changes increased the amount of those subsidies for people across income levels and raised eligibility levels, including for the first time people with incomes 400% or more above the federal poverty level — $62,600 for an individual or $128,600 for a family of four nationally.

The average person or family nationwide that receives enhanced subsidies under the 2021 law would see their premiums more than double, according to an analysis released Sept. 30 by San Francisco-based health research organization KFF.

The 70,000 Long Islanders earning up to 250% of the poverty level, but making too much for Medicaid, paid $0 premiums through a federally funded state program that is being phased out because funding is being eliminated. If the subsidies are extended, they'll still pay something, but less than if the enhanced aid expires.

Highest earners would see biggest increase

The lower the income, the higher the percentage of the premium is generally paid for by the subsidy, so low- and lower-middle-income people would generally face the biggest percentage increases, said Matt McGough, an ACA analyst for KFF. People with higher incomes would often see the largest dollar amount increases, he said.

Generally, the ceiling for subsidies is at about 550% — $176,825 for a family of four — to 600% of the poverty level. For example, a family of four in Melville with a $176,825 household income would see their premiums for the cheapest ACA plan jump 131%, from $8,829 a year to $20,423 a year, according to a KFF online calculator.

"People are going to make choices — choices between groceries and health insurance premiums, choices between rent or mortgage and health insurance premiums," Baird-Streeter said.

Many may choose to forgo insurance, said David Nemiroff, president and CEO of Harmony Healthcare, which runs nine nonprofit health centers in Nassau.

"If they can’t afford health insurance and become uninsured, we will take care of them," he said. But, he said, "it'll become increasingly challenging to do that financially" unless the organization receives more state and federal grants to help subsidize care.

Political sides

Gillibrand blamed Republicans for the government shutdown and said while "Democrats are ready to negotiate. ... Republicans are refusing to come to the table."

Long Island’s two Republican congressmen, Reps. Andrew Garbarino (R-Bayport) and Nick LaLota (R-Amityville) blamed Senate Democrats for voting against a bill that would have kept the government open.

"Discussions around the premium tax credits will be had when Senate Democrats reopen the government," Garbarino said in a statement. "These policies are intricate and require time and thoughtful discussion to reach compromise."

Gillibrand said there’s little time left to reach an agreement, because ACA open enrollment begins Nov. 1.

LaLota said in a statement he supports a bill sponsored by Rep. Jen Kiggans (R-Va.) to extend the subsidies for a year. Rep. Tom Suozzi (D-Glen Cove) is the lead Democratic sponsor of that bill, which Democratic House Minority Leader Hakeem Jeffries Tuesday called "a laughable proposition" because enrollees should get these benefits permanently.

On Wednesday, he softened his opposition, and his harsh criticism of lawmakers supporting the compromise, stating, "At the end of the day the caucus in good faith will evaluate anything presented by the Senate."

Newsday’s Billy House contributed to this story.

By David Olson

david.olson@newsday.com@DavidOlson11

David Olson covers health care. He has worked at Newsday since 2015 and previously covered immigration, multicultural issues and religion at The Press-Enterprise in Southern California.