A bill that would extend premium subsidies for health coverage under the Health Care Tax Credit (HCTC) program has been passed by both the U.S. House of Representatives and Senate, meaning it’s on the way to President Obama’s desk.
The HCTC was enacted as part of the Trade Act of 2002. As originally enacted, it provided a 65-percent tax credit for qualifying health coverage (including COBRA continuation coverage). Those who can benefit from the HCTC are:
- individuals who receive a benefit through one of the Trade Adjustment Assistance (TAA) programs;
- Pension Benefit Guaranty Corporation (PBGC) payees who are 55 years old or older; and
- qualified family members of TAA recipients and PBGC payees.
Eligible individuals cannot be enrolled in certain other health coverage such as Medicaid or Medicare.
TAA programs must be periodically reauthorized, but congressional debate over trade language in broader legislation delayed matters. The possibility of an HCTC extension began to look more promising when the White House announced on June 28 an agreement that would, among other things, increase the HCTC from 65 percent to “a more affordable level” of 72.5 percent.
The Trade Adjustment Assistance Extension Act of 2011 (H.R.2832), would do just that. The bill, which was introduced by House Ways and Means Chairman Dave Camp, R-Mich., passed the House on Oct. 12 and passed the Senate on Sept. 22. The bill would also extend the HCTC program though Jan. 1, 2014.
For an update on this article, go here.