Report: Fixing health law ‘glitch’ would expand subsidies to tens of thousands

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Advocacy groups have been pressing federal regulators to apply the affordability test to family coverage, but Treasury Department officials said their hands are tied because of the way the law was written.

The new study recommends that federal regulators change their draft rules to exclude employees with affordable workplace insurance from getting subsidies, while still allowing their families to get them. Under that scenario, the study concludes, 1.6 million Californians would end up in the states subsidized exchange, versus 1.46 million under current regulations.

"Regulations recently proposed by the Department of the Treasury would make family members ineligible for subsidized coverage in the exchange if an employee is offered affordable self-only coverage by an employer, even if family coverage is unaffordable," the universities stated in their report. "This could have significant financial consequences for low- and moderate-income families that fall in this gap."

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