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Governor Shapiro’s Proposed State-Based Health Insurance Subsidy Program Clears the House of Representatives

06/06/2024

Pennsylvania Insurance Commissioner applauds bipartisan support for legislation to make health insurance more affordable​

Harrisburg, PA – The Shapiro Administration today applauded the House of Representatives' bipartisan approval of Governor Josh Shapiro's proposed state-based subsidy program for low and middle-income Pennsylvanians purchasing coverage through Pennie, Pennsylvania's state-run insurance marketplace. Representative Patty Kim, Chair of the House Insurance Committee, introduced the Governor's proposal as House Bill 2234. If enacted into law and appropriately funded, this bill would pair the Governor's proposed subsidy program with a stronger state reinsurance program for high-cost claims.

“PID applauds the House for moving this bill forward. We want Pennsylvanians, who are facing rising costs of health care, to not only be able to afford their health insurance, but also to afford to be able to use it," said Pennsylvania Insurance Commissioner Michael Humphreys. “Pennsylvanians are feeling the effects of inflation, and they should not be worrying about how to pay to see their doctors because they are insured but cannot afford their deductibles. The Governor's proposal would positively impact nearly all Pennsylvanians that rely on individual market Affordable Care Act-compliant coverage."

Pennie now covers a record-breaking 435,000 Pennsylvanians with affordable, high-quality health coverage – an increase of over 150,000 covered lives since Pennie's inception in 2020.  A Commonwealth subsidy program would provide financial assistance to hundreds of thousands of Pennsylvanians by cutting the costs of health care coverage, helping every Pennsylvanian have access to the health care they need to live healthy and productive lives. The Governor's proposal to strengthen the state's reinsurance program would help most other Pennsylvanians purchasing individual market health insurance by reducing premiums from where they would otherwise be absent this program.  

“House Bill 2234 has two goals in mind: more people get insurance, and more people get better insurance," said Representative Patty Kim. “The bill gives Pennie the flexibility to explore ways to mitigate high costs and deductibles for about 200,000 to 300,000 Pennie customers."

Governor Josh Shapiro's 2024-2025 budget proposal also calls for $50 million from an existing PID Fund to strengthen the PID-administered state reinsurance program, allowing Pennie to spend Pennie-generated revenue of more than $40 million on the state-based subsidy program.

Together, the reinsurance and subsidy program will:

  • Enhance assistance for an estimated 500,000 Pennsylvanians;
  • Provide at least 200,000 Pennsylvanians with enhanced savings, allowing them to keep their current health insurance, or potentially purchase better coverage; 
  • Prevent medical debt before it accumulates for Pennsylvanians, including many in rural communities;   
  • Benefit Pennsylvanians through better access to affordable care;
  • Benefit healthcare providers who will see less uncompensated care and may have fewer bills to chase as more Pennsylvanians are insured with better policy benefits; and
  • Benefit health insurance companies likely to see higher membership potentially covered by more robust policies.  

Consumer advocates have lauded the Governor's proposal as “a good policy tool" that “would help hardworking Pennsylvanians by making Pennie plans more affordable" and “help more Pennsylvanians purchase an affordable plan, lowering the number of families who go uninsured because they couldn't afford coverage in the first place."

For more information on how the Governor's 2024-25 budget proposal would cut healthcare costs, visit shapirobudget.pa.gov.  

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