This bill extends and modifies tax credits that help people afford health insurance. Specifically, it extends the premium tax credit—a subsidy that reduces what people pay for monthly health insurance premiums—through 2027 instead of ending in 2025. It also increases the income threshold for who can receive this credit, allowing people earning up to 700% of the federal poverty level to qualify (previously there was no upper limit stated in this way).

The bill also creates a new option for how people can receive their tax credits. Instead of getting the credit applied directly to their insurance bill or as a tax refund, people enrolled in basic bronze-level or catastrophic health plans can now choose to have their credit deposited into a Health Savings Account (HSA)—a special savings account designed for medical expenses. This gives people more flexibility in how they use their health insurance subsidies.

Additionally, the bill clarifies that people who are not lawfully present in the United States cannot receive these tax credits. It requires government agencies to verify immigration status when people apply for health insurance subsidies. These changes take effect starting in 2026, giving people and insurers time to adjust. The bill also authorizes whatever funding is needed to make sure cost-sharing reductions (which lower out-of-pocket costs like deductibles and copays) continue to be paid.