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Create structural reform for house ACA proposal
Fixes #6809
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‎changelog_entry.yaml‎

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- bump: minor
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changes:
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added:
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- ACA PTC 600% FPL cliff reform extending 2021 subsidy levels with 8.5% contribution cap to 600% FPL

‎policyengine_us/parameters/gov/contrib/aca/ptc_600_fpl_cliff/brackets.yaml‎

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# ACA PTC contribution brackets with 2021 subsidy levels extended to 600% FPL.
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# Maintains 8.5% contribution rate from 400% to 600% FPL, then ends eligibility.
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description: ACA PTC contribution percentages by household income (2021 levels extended to 600% FPL).
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metadata:
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type: single_amount
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threshold_unit: /1
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rate_unit: /1
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label: ACA PTC contribution rate brackets (600% FPL cliff)
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reference:
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- title: 26 U.S. Code § 36B(b)(3)(A) - Refundable credit for coverage under a qualified health plan
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href: https://www.law.cornell.edu/uscode/text/26/36B#b_3_A
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- title: American Rescue Plan Act of 2021 - ACA premium subsidy expansion
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href: https://www.congress.gov/bill/117th-congress/house-bill/1319
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- title: Inflation Reduction Act of 2022 - ACA subsidy extension through 2025
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href: https://www.congress.gov/bill/117th-congress/house-bill/5376
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- title: Affordable Care Act Enhancement Act - Proposed subsidy extension to 600% FPL
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href: https://www.politico.com/f/?id=0000019a-6b87-dc40-a1bb-6fe74c510000
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brackets:
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- threshold:
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2026-01-01: 0
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amount:
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2026-01-01: 0
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- threshold:
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2026-01-01: 1.5
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amount:
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2026-01-01: 0
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- threshold:
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2026-01-01: 2.0
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amount:
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2026-01-01: 0.02
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- threshold:
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2026-01-01: 2.5
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amount:
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2026-01-01: 0.04
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- threshold:
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2026-01-01: 3.0
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amount:
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2026-01-01: 0.06
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- threshold:
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2026-01-01: 4.0
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amount:
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2026-01-01: 0.085
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- threshold:
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2026-01-01: 6.0
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amount:
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2026-01-01: 0.085

‎policyengine_us/parameters/gov/contrib/aca/ptc_600_fpl_cliff/in_effect.yaml‎

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description: Whether the ACA PTC 600% FPL cliff extension is in effect.
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values:
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0000-01-01: false
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metadata:
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unit: bool
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period: year
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label: ACA PTC 600% FPL cliff in effect

‎policyengine_us/parameters/gov/contrib/aca/ptc_600_fpl_cliff/income_eligibility.yaml‎

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# Extended income eligibility for ACA PTC up to 600% FPL.
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# Allows subsidies to continue up to 600% FPL with 8.5% contribution cap.
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description: Eligibility for ACA Premium Tax Credit by percent of modified AGI to federal poverty line (600% FPL limit).
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metadata:
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type: single_amount
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period: year
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threshold_unit: /1
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amount_unit: bool
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label: ACA PTC income eligibility conditions (600% FPL cliff)
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reference:
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- title: 26 U.S. Code § 36B(c)(1) - Eligibility requirements
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href: https://www.law.cornell.edu/uscode/text/26/36B#c_1
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brackets:
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- threshold:
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2026-01-01: 0
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amount:
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2026-01-01: false
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- threshold:
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2026-01-01: 1.00
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amount:
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2026-01-01: true
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- threshold:
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2026-01-01: 6.0
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amount:
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2026-01-01: false

‎policyengine_us/reforms/aca/__init__.py‎

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from policyengine_us.reforms.aca.aca_ptc_simplified_bracket import (
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create_aca_ptc_simplified_bracket_reform,
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)
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from policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff import (
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create_aca_ptc_600_fpl_cliff_reform,
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)

‎policyengine_us/reforms/aca/aca_ptc_600_fpl_cliff.py‎

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from policyengine_us.model_api import *
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from policyengine_core.periods import period as period_
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def create_aca_ptc_600_fpl_cliff() -> Reform:
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class aca_required_contribution_percentage(Variable):
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"""
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ACA required contribution percentage with 2021 subsidy levels extended to 600% FPL.
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This reform extends the enhanced ACA premium subsidies enacted under the
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American Rescue Plan Act of 2021 (ARPA), but moves the eligibility cliff
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from 400% FPL to 600% FPL. The reform maintains the 8.5% maximum
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contribution rate for households between 400% and 600% FPL.
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Under this reform:
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- 0-150% FPL: 0% contribution
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- 150-200% FPL: 0-2% contribution
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- 200-250% FPL: 2-4% contribution
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- 250-300% FPL: 4-6% contribution
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- 300-400% FPL: 6-8.5% contribution
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- 400-600% FPL: 8.5% contribution (extended)
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- Above 600% FPL: No subsidy eligibility
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This eliminates the subsidy cliff that would otherwise occur at 400% FPL,
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making more middle-income households eligible for ACA subsidies while
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maintaining a cap on contribution percentages.
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"""
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value_type = float
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entity = TaxUnit
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label = "ACA required contribution percentage with 600% FPL cliff (i.e., IRS Form 8962 'applicable figure')"
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unit = "/1"
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definition_period = YEAR
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reference = [
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"26 U.S. Code § 36B(b)(3)(A) - Refundable credit for coverage under a qualified health plan",
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"https://www.law.cornell.edu/uscode/text/26/36B#b_3_A",
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"American Rescue Plan Act of 2021",
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"https://www.congress.gov/bill/117th-congress/house-bill/1319",
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"Affordable Care Act Enhancement Act - Proposed subsidy extension to 600% FPL",
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"https://www.politico.com/f/?id=0000019a-6b87-dc40-a1bb-6fe74c510000",
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]
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def formula(tax_unit, period, parameters):
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magi_frac = tax_unit("aca_magi_fraction", period)
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p = parameters(period).gov.contrib.aca.ptc_600_fpl_cliff.brackets
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return np.interp(magi_frac, p.thresholds, p.amounts)
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class is_aca_ptc_eligible(Variable):
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"""
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Extended ACA PTC eligibility up to 600% FPL.
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"""
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value_type = bool
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entity = Person
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label = "Person is eligible for ACA premium tax credit and pays ACA premium"
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definition_period = YEAR
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def formula(person, period, parameters):
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# determine status eligibility for ACA PTC
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fstatus = person.tax_unit("filing_status", period)
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separate = fstatus == fstatus.possible_values.SEPARATE
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immigration_eligible = person(
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"is_aca_ptc_immigration_status_eligible", period
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)
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taxpayer_has_itin = person.tax_unit("taxpayer_has_itin", period)
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is_status_eligible = (
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taxpayer_has_itin & ~separate & immigration_eligible
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)
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# determine coverage eligibility for ACA plan
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INELIGIBLE_COVERAGE = [
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"is_medicaid_eligible",
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"is_chip_eligible",
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"is_aca_eshi_eligible",
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"is_medicare_eligible",
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]
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is_coverage_eligible = (
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add(person, period, INELIGIBLE_COVERAGE) == 0
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)
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# determine income eligibility for ACA PTC (using reform parameter)
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p = parameters(period).gov.contrib.aca.ptc_600_fpl_cliff
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magi_frac = person.tax_unit("aca_magi_fraction", period)
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is_income_eligible = p.income_eligibility.calc(magi_frac)
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# determine which people pay an age-based ACA plan premium
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p_aca = parameters(period).gov.aca
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is_aca_adult = person("age", period) > p_aca.slcsp.max_child_age
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child_pays = (
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person("aca_child_index", period) <= p_aca.max_child_count
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)
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pays_aca_premium = is_aca_adult | child_pays
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return (
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is_status_eligible
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& is_coverage_eligible
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& is_income_eligible
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& pays_aca_premium
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)
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class reform(Reform):
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def apply(self):
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self.update_variable(aca_required_contribution_percentage)
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self.update_variable(is_aca_ptc_eligible)
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return reform
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def create_aca_ptc_600_fpl_cliff_reform(
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parameters, period, bypass: bool = False
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):
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if bypass:
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return create_aca_ptc_600_fpl_cliff()
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p = parameters.gov.contrib.aca.ptc_600_fpl_cliff
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current_period = period_(period)
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# Check if reform is active within a 5-year lookahead window
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# This allows the reform to be selected in the web app interface
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# even if it's scheduled to start in a future year
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reform_active = False
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for i in range(5):
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if p(current_period).in_effect:
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reform_active = True
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break
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current_period = current_period.offset(1, "year")
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if reform_active:
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return create_aca_ptc_600_fpl_cliff()
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else:
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return None
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aca_ptc_600_fpl_cliff = create_aca_ptc_600_fpl_cliff_reform(
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None, None, bypass=True
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)

‎policyengine_us/tests/policy/contrib/aca/ptc_600_fpl_cliff.yaml‎

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- name: Single filer at 0% FPL - zero contribution
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 0.0
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output:
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aca_required_contribution_percentage: 0.0
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- name: Single filer at 150% FPL - zero contribution
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 1.5
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output:
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aca_required_contribution_percentage: 0.0
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- name: Single filer at 200% FPL - 2% contribution
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 2.0
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output:
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aca_required_contribution_percentage: 0.02
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- name: Single filer at 250% FPL - 4% contribution
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 2.5
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output:
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aca_required_contribution_percentage: 0.04
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- name: Single filer at 300% FPL - 6% contribution
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 3.0
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output:
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aca_required_contribution_percentage: 0.06
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- name: Single filer at 400% FPL - 8.5% contribution (old cliff point)
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 4.0
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output:
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aca_required_contribution_percentage: 0.085
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- name: Single filer at 500% FPL - 8.5% contribution (flat rate)
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 5.0
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output:
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aca_required_contribution_percentage: 0.085
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- name: Single filer at 600% FPL - 8.5% contribution (new cliff point)
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 6.0
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output:
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aca_required_contribution_percentage: 0.085
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- name: Single filer at 175% FPL - interpolated 1% contribution
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 1.75
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output:
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aca_required_contribution_percentage: 0.01
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- name: Single filer at 350% FPL - interpolated 7.25% contribution
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 3.5
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output:
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aca_required_contribution_percentage: 0.0725
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- name: Baseline comparison at 400% FPL - shows elimination of cliff
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period: 2026
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absolute_error_margin: 0.00001
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input:
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aca_magi_fraction: 4.0
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output:
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aca_required_contribution_percentage: 0.0996
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- name: Baseline comparison at 500% FPL - shows new eligibility
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period: 2026
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absolute_error_margin: 0.00001
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input:
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aca_magi_fraction: 5.0
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output:
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aca_required_contribution_percentage: 0.0996
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- name: Edge case - Very high income at 700% FPL extends last bracket
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period: 2026
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reforms: policyengine_us.reforms.aca.aca_ptc_600_fpl_cliff.aca_ptc_600_fpl_cliff
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absolute_error_margin: 0.00001
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input:
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gov.contrib.aca.ptc_600_fpl_cliff.in_effect: true
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aca_magi_fraction: 7.0
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output:
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aca_required_contribution_percentage: 0.085

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