What would a public option mean?

Man showing young couple something on a computer screen in an office.
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By “public option,” Biden meant a government-sponsored insurance program that would compete alongside private insurance, either through the private or employer market.

Biden put forward the proposal as an alternative for “Medicare for All,” which would effectively replace most private insurance by making the government the “single payer” for the bulk of the country’s health care expenses.

But polling has shown that more Americans support a public option than support Medicare for All: Data released from the Kaiser Family Foundation last year found that 68% of adults in the U.S. supported a public option, including 85% of Democrats and 42% of Republicans.

Meanwhile, the same poll showed only 58% of Americans supported a Medicare for All approach.

That initial plan would have ensured 97% of Americans would have health insurance, according to Biden’s campaign. The ambitious proposal was put forward during the tight Democratic presidential primary amid polling that showed much of the party’s base ranked health care as a top issue.

This isn’t the only health insurance proposal Biden’s office has since dropped.

On the campaign trail, Biden had also pledged to lower the Medicare eligibility age from 65 to 60. But that proposal was left out of the White House’s $1.8 trillion American Families Plan, which was announced in April.

Here’s the good news

Man holding a tablet with insurance claim form open on it.
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There’s still some reason for optimism on the health insurance front.

Biden’s $1.9 trillion COVID relief bill, which passed in March, introduced generous new subsidies for health insurance plans bought on Healthcare.gov and other Affordable Care Act (ACA) exchanges.

Now, if you’re not covered through an employer or government plan like Medicare or Medicaid, your Obamacare premiums are capped at 8.5% of your income for the next two years.

And the plan makes those subsidies available to you if you earn more than four times the federal poverty rate — which works out to about $51,520 for single people and $106,000 for a family of four.

What does that look like?

Woman looking at insurance documents and using a calculator to add up numbers.
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The changes, which went into effect April 1, qualify about 15 million uninsured Americans for financial assistance and offer 9 million people with subsidized plans even more help.

On average, you’ll see your premiums decrease about $50 a month. And anyone making more than $51,000 will be able to get coverage for about $1,000 less per month than before the bill was passed.

To get the premium discount, you’ll have to go back to the website where you bought your health insurance plan and confirm that you want the new, expanded tax credit for your existing plan. That could either be HealthCare.gov or your state’s version of the site.

In response to the COVID pandemic, Biden established a special ACA enrollment period, meaning you now have until Aug. 15 to take advantage of these new subsidies right away instead of waiting for the discount to be applied on your taxes next year.

By mid-May, a million people had already signed up for a new, more affordable health insurance plan.

And while these new premiums are meant to be temporary — meaning pricing could return to normal in 2023 — Biden’s families plan proposes to make them permanent.

Finding room in your budget right now

Older senior married couple in distress, looking at laptop on the kitchen counter.
El Nariz / Shutterstock

You don’t have to wait for Congress to make moves to provide you with a more affordable health insurance plan. You can start looking around now to find a policy that meets your budget and coverage needs right now.

And if you want to add a little more to your monthly budget too, you have a few options.

  • Cut the cost of your debt. If you’re currently being crushing by their health insurance and medical costs (or other debts), you may want to consider folding your loans into a single, lower interest loan to give yourself some breathing room and help get out from under your debt sooner.

  • Keep the insurance savings rolling. By shopping around for the cheapest policies, you could potentially cut car insurance costs by more than $1,000 and knock down your homeowners insurance bill by hundreds as well

  • Turn your pennies into a portfolio. Forget everything you thought you knew about the stock market: You don’t need to be rich or know all the lingo or pay massive brokerage fees to see serious gains. Using a popular app, you can invest "spare change" from everyday purchases and grow those pennies into serious profits.

About the Author

Sigrid Forberg

Sigrid Forberg


Sigrid is a reporter with MoneyWise. Before joining the team, she worked for a B2B publication in the hardware and home improvement industry and ran an internal employee magazine for the federal government. As a graduate of the Carleton University Journalism program, she takes pride in telling informative, engaging and compelling stories.

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