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Happy Thursday morning.

One of the biggest problems Democrats face now is the looming expiration of Affordable Care Act subsidies. If Congress doesn’t act, as many as 13 million Americans will get a letter this fall informing them that their health care premiums are going to skyrocket come 2023. This could be a major headache for Democrats just weeks before the midterm elections.

The prevailing wisdom is that Democrats will try to insert language in a budget reconciliation package – the next version of Build Back Better – to extend the current tax credits, which were expanded last year as part of the American Rescue Plan. We don’t see another way for the Senate to avert a premium increase for ACA enrollees besides including it in a reconciliation package, which could pass with just 50 votes.

But Hill Democrats and the White House both acknowledge that the inclusion of ACA subsidies in any reconciliation bill could end up resting with one person – Sen. Joe Manchin (D-W.Va.). Democrats have said they’re largely handing the keys to the reconciliation package over to Manchin, a recognition that he’s the critical vote in the chamber.

The price tag for extending these subsidies is high, as much as $220 billion over a decade, according to CBO.

Here’s the thing: We spoke to a number of people in House and Senate leadership and in the White House and none of them seemed to have any idea where Manchin stood on this issue.

So we spoke to Manchin about Obamacare premium subsidies last night. Manchin was pretty non-committal. In fact, he was borderline negative.

Here’s Manchin:

We then asked Manchin directly if he would support extension of the tax credits.

Wait a second, what? ACA premiums are going to soar as much as 50% in January if the expanded tax credits expire and no one has presented Manchin with a proposal to remedy that? On a bill that would only require a simple majority vote?

So we continued. Would Manchin support ACA subsidies in reconciliation if Democratic leadership and the White House proposed it?

We’ll leave it to you. Does this sound like someone who is going to support extending ACA subsidies in the reconciliation package?

And, by the way: Manchin said a reconciliation deal between him and Senate Majority Leader Chuck Schumer isn’t particularly close.

A Schumer spokesperson said the New York Democrat “strongly supports extending the ACA subsidies but Sen. Manchin asked that this topic not be discussed before other core issues are settled.” Of course, there are plenty of House Democrats who would say that this is a core issue.

House Majority Leader Steny Hoyer is leading a press call with reporters on this issue today with Rep. Lauren Underwood (D-Ill.). And Hoyer and House Majority Whip Jim Clyburn wrote an op-ed on it earlier this month.

“It needs to be in the reconciliation bill,” Hoyer told us last night.

Speaker Nancy Pelosi pushed on the issue during a meeting with President Joe Biden and Schumer at the White House last week. Pelosi echoed concerns of Frontliners and New Dems that millions of Americans will face the choice of sharp premium increases or losing their insurance this fall. The enhanced tax credits don’t actually expire until the end of December but notices of the big premium hikes would hit mailboxes in October, just weeks before the midterms.

During that meeting, Schumer and Biden both expressed doubts that the issue would be taken care of in reconciliation because they didn’t think Manchin would support it, according to multiple House Democratic sources.

Pelosi alluded to as much in a press conference the next day. “There are certain concerns that we have about subsidies in the healthcare bill and the rest, which may or may not be in the negotiation,” Pelosi said when asked about the White House meeting.

So, as we inch toward the July 4th recess here, there are a few realities worth keeping in mind about ACA subsidies.

→	July is going to be a very busy legislative month. Congress is going to be trying to get USICA done – more on that below.

→	If reconciliation is going to happen, it needs to be done procedurally before Sept. 30, when the budget resolution expires.

On guns

Also: The Senate will vote later this morning to end a GOP filibuster on the bipartisan gun package. Proponents of the bill have more than the 60 votes needed on this key procedural motion.

Once cloture is invoked, the Senate will have up to 30 hours of debate on the gun bill. The July 4 recess will begin after the bill is passed, so it’s possible that GOP opponents will want to speed up consideration since passage is inevitable.

However, these Republicans also want amendment votes to revise or water down the bill, and that’s not happening. So we’ll have to see what the vibe is.

If the Senate passes the bill today or tomorrow, the House will stay in town until it votes on the measure and sends it on to President Joe Biden.

– John Bresnahan, Heather Caygle and Jake Sherman

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