American Rescue Plan Signed Into Law
President Biden wasted no time signing the American Rescue Plan which provides a third round of stimulus checks for many Americans and allocates additional funding for COVID-19 vaccine distribution, state and local governments, small businesses, and anti-poverty programs.
As we reported in the previous Washington Update, VA is receiving a significant infusion of cash from the $1.9 trillion measure. Much of the $17 billon slated for VA goes directly toward the care of veterans. This includes covering more expensive care that veterans may need after a year of enduring the pandemic and addressing the coming surge of Compensation and Pension Exams and elective procedures that were put on hold over the past year.
The remaining funding will go toward things like VA’s supply chain modernization efforts, supporting state veteran homes, providing retraining assistance to veterans who became unemployed because of the pandemic, and waiving copayments for veterans who sought VA medical care over the past year.
The massive legislation also included several provisions representing significant victories for the disability community. After a yearlong effort by advocates, Congress increased federal Medicaid matching funds by 10 percent to support home and community-based services for one year beginning April 1, 2021.
Those additional funds are on top of the 6.2 percentage point increase in the federal share for the Medicaid program provided in earlier COVID packages and will pay for an array of services designed to keep people out of institutions.
Special education programs received $3 billion in enhanced support and families with adult dependents, who had been excluded from previous COVID relief bills, will finally receive economic impact payments for those individuals.
The bill also significantly expands the subsidies in the ACA Marketplaces to cover more middle-class families. Specifically, it removes the current cap that makes any family with income above 400 percent of the poverty level ineligible for any subsidies. It also provides that individuals below 150 percent of the poverty level pay no premiums at all compared to 4 percent of their income currently.
In addition, the bill provides a new incentive for the 12 states that have not expanded Medicaid to do so by temporarily increasing the base federal match by five percentage points for two years for any state that newly expands its program. If all 12 remaining states expanded Medicaid, more than 2 million uninsured people would gain access to Medicaid.
The bill also extends federal unemployment compensation benefits of $300 per week through September 6, 2021, and exempts from income taxes the first $10,200 of unemployment benefits received in 2020. Additionally, it contains a tax rebate of $1,400 for individuals with incomes of $75,000 or less, increased by $1,400 for each dependent.
It would expand eligibility and increase the maximum earned income tax credit (EITC) for childless adults and increase the child tax credit (CTC) to $3,000 per child (with a more generous $3,600 credit for children under the age of 6).
Furthermore, it expands and extends through September 2021 paid sick and family leave tax credits for employers and provides for full federal subsidies of individual COBRA premiums for six months for those who lost their jobs due to the pandemic.
The law also included significant increases in housing and nutrition assistance and support for low income energy assistance programs. A detailed summary of the American Rescue Plan published by the Senate Majority Leader’s office can be found here.