Sen. Bill Cassidy, R-La., answers questions from reporters after chairing a hearing of the Senate Health, Education, Labor and Pensions Committee on September 17, 2025. (Photo by Jennifer Shutt/States Newsroom)
WASHINGTON – Republicans in the U.S. Senate announced Tuesday they will vote on their own health care proposal later this week to counter a Democratic bill that would extend expanded Affordable Care Act market plan tax credits for three more years.
The 32-page GOP bill would not address the expiring ACA market tax credits, but would send payments to certain Americans through health savings accounts to cover some of the cost of health care.
Neither measure has the 60 votes needed to advance under that chamber’s rules. This would cause ACA Marketplace subsidies to expire at the end of the year and dramatically escalate the cost of health insurance for the millions of people enrolled in these plans.
Senate Majority Leader John Thune, R-S.D., said Democrats’ bill to simply extend the expanded ACA market tax credits to offset the costs Americans pay for that insurance is unacceptable.
“The way the program is structured, the money goes directly to the insurance companies,” Thune said. “And our view is that the way this should work is that you should find a way to deliver the benefit to the patients, not the insurance companies.”
Thune said the Democrats’ bill lacks an income cap on tax credits in ACA marketplaces and allows $0 premiums for health insurance plans – guaranteeing the measure will fail.
Senate Democratic leader Chuck Schumer of New York called the GOP proposal a “non-starter” that would result in “garbage insurance.” He said the only way to avoid a dramatic escalate in health insurance costs next year is to extend the expanded ACA tax credits.
“Their false proposal is dead from the start,” Schumer said. “Not only does the bill fail to extend tax breaks, it also increases costs, imposes a host of new abortion restrictions on women, increases junk fees, and permanently funds cost-sharing reductions.”
Multiple plans
Senate Republicans have been debating for weeks whether to vote on a GOP plan to show the party has something to offer in reducing health care costs. Thune promised Democrats a vote on a health care law of their choice in return for votes to end the government shutdown.
Schumer announced last week that Democrats would vote on a three-year extension of the current expanded ACA tax credits.
Several Republican senators, including Susan Collins of Maine and Bernie Moreno of Ohio, have released plans that would include extending expiring tax credits while beginning to phase out those subsidies.
But Republican leaders ultimately decided to vote on a proposal released earlier this week by Health, Education, Labor and Pensions Committee Chairman Bill Cassidy, R-La., and Finance Committee Chairman Mike Crapo, R-Idaho.
The Cassidy-Crapo legislation would require the Department of Health and Human Services to deposit money into health savings accounts for people enrolled in bronze or catastrophic health insurance plans purchased in the ACA marketplace in 2026 or 2027 a summary the invoice.
Health Savings Accounts are tax-advantaged savings accounts that allow consumers to pay for medical expenses that would otherwise not be reimbursed. These are not health insurance products.
ACA Marketplace participants who choose a bronze or catastrophic plan and make up to 700% of the federal poverty level will receive $1,000 annually if they are between ages 18 and 49 and $1,500 per year if they are between ages 50 and 64.
This would set an annual income threshold of $109,550 for an individual or $225,050 for a family of four, according to 2025 Federal Poverty Guidelines. The numbers are slightly higher for residents of Alaska and Hawaii.
According to the summary of the Republican bill, the funds could not be used for access to abortion or gender reassignment surgery.
Proposal modeled on Trump comments
Cassidy and Crapo explained how their proposal would work in their afternoon speeches, where they also aired their grievances about how the Affordable Care Act has affected Americans’ health care costs.
Crapo chided Democrats for enacting expanded ACA market tax credits during the coronavirus pandemic and phasing them out at the end of this year.
“The pattern has become clear: Democrats are responding to rising premiums by throwing taxpayer money at the problem,” Crapo said. “Their supposedly short-term solutions only drive up premiums and make it harder to solve the problem. They seem to leave us no choice but to do the same thing over and over again.”
The GOP plan, he said, was modeled on President Donald Trump’s call to send money directly to Americans to spend on their health care.
“Families can use this money to cover costs not covered by their insurance policy without having to wait for insurance companies to approve their treatment decisions,” Crapo said. “Because families want the best value, they will seek the most appropriate treatment. Over time, this will lead to lower healthcare costs as providers compete for patients.”
Cassidy said the bill would not subsidize health insurance premiums but would aid some Americans pay for doctor exams, dentist visits, eyeglasses and prescriptions.
Once eligible ACA Marketplace participants receive this funding in their health savings account, they will look for lower rates, including for X-rays, which are often used to determine whether someone has broken a bone.
“She’ll say, ‘Wait a minute, the X-ray costs $150 here and $500 there. I’ll go where it’s cheaper, not more expensive,'” Cassidy gave an example. “And I can tell you, when that happens, the people who are more expensive start lowering their price.”
