On Thursday, March 11, 2021, President Joe Biden signed a $1.9 trillion dollar bill, the American Rescue Plan Act of 2021 (ARP), into law. “This historic legislation is about rebuilding the backbone of this country and giving people in this nation, working people, middle class folks, people who built the country, a fighting chance,” President Biden said in the Oval Office before signing. “That’s what the essence of it is”.
The legislation includes direct relief payments of up to $1,400 for individuals, major improvements to the affordability of healthcare coverage and access, funding for distribution of vaccines, and the reopening of schools and colleges. Also included is an extension of Unemployment payments, an expanded Child Tax Credits program, as well as relief to states, local governments, veterans, farmers and foreign assistance.
The president, vice president, first lady and second gentlemen, along with other members of the cabinet, are set to travel the country to explain ARP’s benefits to the public. Governors, mayors, local community leaders and others will also help spread the word.
ARP benefits include:
- Giving $6 billion in the form of a $1,400 check to most Americans earning up to $75,000
- Extending a $300 weekly federal boost to unemployment benefits through August 2021
- Sending $350 billion to state and local governments whose revenue has declined because of COVID-19’s impact on their economies
- Allocating $130 billion to assist in reopening schools and colleges
- Allotting $30 billion to help renters and landlords weather economic losses
- Devoting $50 billion for small-business relief assistance
- Dedicating $160 billion for vaccine research, development and distribution needs
- Expanding the child tax credit up to $3,600 per child in 2021
- Expanding 2021 premium subsidies for people who buy health insurance through the Affordable Care Act (“ACA”) on their own instead of getting it from an employer or a government program like Medicare or Medicaid
The changes to the Affordable Care Act provide significant funding to make premiums more affordable across the board. Under the ARP, no one would have to pay more than 8.5% of income for a benchmark silver plan, which is the second cheapest plan available.
As an example, those earning from 100% to 150% of the poverty line ($26,500 to $39,750 for a family of four) would go from a maximum premium of 4.14% to zero premium. Those earning twice the poverty threshold would move from a maximum outlay of 6.52% of income to 2%.
With every passing year, it appears more likely that the ACA will remain a part of America’s healthcare system, especially when improvements, such as through the ARP, continue to be passed.
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