The Inflation Reduction Act of 2022 cleared its last hurdle in the Senate and House on Friday, August 12th. This bill addresses a number of issues, which include making health insurance and prescription medications cheaper; addressing the global issue of climate change; and moving toward a more equitable tax structure.
Pennsylvania’s US Senator Bob Casey voted in favor of the bill, while Sen. Toomey voted against it. This bill included a provision from Senator Casey focusing on health care benefits.
“….This legislation is the most ambitious climate bill the Senate has ever passed. It will lower costs for Americans at the gas pump and on their electricity bills. It will shore up the U.S.’s place as a clean energy producer and reduce our greenhouse emissions by 40% by 2030…”, Senator Casey explained.
A significant step towards providing quality health care for as many Americans as possible, the measures making Affordable Care Act (ACA) marketplace coverage more affordable will prevent 3.1 million individuals from losing coverage and becoming uninsured in 2023 while also lowering the cost of coverage for millions more.
The agreement safeguards 14.5 million Americans who signed up for marketplace coverage this year, notably those with low and moderate incomes, from experiencing a rise in their premiums the following year by extending for three years the American Rescue Plan’s temporary subsidy.
Without the extension, some people’s premiums would have increased by at least double or triple. These increases would have stressed household finances for millions more and resulted in the loss of insurance for an estimated 3.1 million people.
It’s also important to highlight that over 2 million people with earnings below the poverty line lack insurance because their states have not expanded Medicaid. The current plan does nothing to make cheap coverage available to them and it would be up to their legislature to pass expanded coverage. Three out of five Medicaid coverage gap participants are individuals of color, with the majority residing in the South.
Nevertheless, many benefits are included in the bill, which will ease some households’ burdens. For example, a $35 monthly cap on the out-of-pocket cost of insulin is one of the measures the agreement takes to cut prescription drug costs for both the federal government and customers.
The act makes significant strides to improve the fairness of the tax system. Inefficient tax incentives for businesses to buy back their stock are reduced, tax benefits for some profitable organizations are reduced, and the IRS is given greater resources to ensure that high-income individuals and businesses pay their debts.
According to the proposed law, businesses with an average yearly revenue of more than $1 billion must pay at least 15% in taxes on their earnings.
During the last negotiations, the language was amended to exclude any reduction in the corporate minimum tax. Successful businesses will contribute by paying taxes that are evenly dispersed, benefiting public investments in research, education, and infrastructure.
Legislative initiatives to combat climate change have been stalled for a long time. Even while more action will eventually be required, his legislation commits a historic $369 billion to programs that will increase the production of clean energy, produce new clean energy technology and jobs in America, and minimize pollution in underserved areas in order to lower costs for families and reduce pollution.
According to a bill summary of the Energy Security and Climate Change Investments, $9 billion in consumer home energy rebate programs, targeted at low-income households, will be used to electrify household appliances and finance energy-efficient retrofits.
A ten-year consumer tax credit program that will lower the cost of installing heat pumps, rooftop solar, electric HVAC systems, and water heaters in houses that are energy efficient and powered by renewable energy. Building domestic supply chains for clean energy technology like batteries and cutting-edge solar panels is one of the key objectives of the Inflation Reduction Act.
Consumer tax credits of up to $7,500 for the purchase of new clean vehicles for lower- and middle-income people, and $4,000 for the purchase of secondhand clean vehicles for lower-income people. Lastly, $1 billion in grants will be given to improve the energy efficiency of affordable housing.
A majority of Americans believe that the Inflation Reduction Act will improve America’s energy security, including 73% of Democrats and 47% of Independents.