Proposed Bill Could Raise NY Health Insurance Premiums by 38% and Cut Coverage
New data released by New York State highlights the significant impact of the proposed GOP 'Big Ugly' Reconciliation Bill on health insurance coverage and costs for New Yorkers. The legislation threatens to reduce health coverage for millions, increase the uninsured population by 1.5 million, and cut $13.5 billion in annual federal healthcare funding earmarked for New York. A major component of the bill is the elimination of the American Rescue Plan's enhanced premium tax credits, which currently help lower insurance costs for many low-income individuals and families in the state.
The removal of these enhanced tax credits is projected to raise the average monthly insurance premiums by 38% for approximately 140,000 low-income New Yorkers purchasing plans through the state's official marketplace, NY State of Health. This translates to an increase of $114 per month for individuals and $228 per month for couples. In addition, more than 100,000 individuals purchasing commercial insurance without tax credits could see an average rate hike of 4.3% due solely to the elimination of these credits.
The combination of premium hikes and reduced affordability may drive healthier individuals out of the insurance market, leading to a less healthy insured pool and accelerating overall cost increases. Early estimates suggest that between 65,000 and 80,000 enrollees in the individual market, representing roughly one-third of that group, could lose their coverage as a result of the bill. Moreover, the bill would introduce new administrative challenges and costs for the state, potentially exceeding $10 million in expenses to implement new requirements.
Beyond financial impacts, the bill could restrict New York’s autonomy over its state-run insurance marketplace by imposing federal administrative mandates. Providers, particularly in rural areas, express concerns about sustaining operations amid increased financial pressures and reduced patient coverage. The loss of financial assistance and increased premiums could also hinder access to vital healthcare services, including mental health care and prescription medications.
New York has made significant strides over the past decade in expanding healthcare access, currently achieving a statewide uninsured rate below 5%, the lowest among large states. The proposed legislation threatens to reverse these gains, risking higher uninsured rates and reduced coverage affordability. Health officials emphasize the broad negative implications for both consumers and the healthcare system statewide if the bill passes.