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What did the CBO estimate in 2021–2024 for extending ARPA-enhanced premium tax credits permanently?
Executive Summary
The Congressional Budget Office did not produce a direct estimate that quantifies the cost of making the American Rescue Plan Act’s (ARPA) enhanced premium tax credits permanent specifically for the 2021–2024 window; instead, its analyses present projections for later multi‑year windows and baseline outlays in 2023–2025. Recent CBO work in 2024 and 2025 places the net budgetary cost of a permanent expansion in the hundreds of billions over multi‑year horizons beginning after 2024, and provides outlay and enrollment context for 2023–2024 [1] [2] [3].
1. What claim was made and why it matters — The missing 2021–2024 permanent estimate
The central claim under scrutiny asks whether the CBO estimated the cost of making ARPA’s enhanced premium tax credits permanent for the 2021–2024 period. CBO’s published documents from June 2024 and later do not present a single-line estimate that states “permanently extend ARPA enhancements for 2021–2024 costs X.” Instead, CBO framed permanent-coverage scenarios across subsequent scoring windows (for example, 2025–2034 or 2026–2035), and provided baseline outlays for 2023 and 2024 that inform broader fiscal effects. This framing matters because cost estimates depend on the scoring window and enactment date; a permanent change enacted after 2024 will be scored over later decades, which is not equivalent to isolating costs solely within 2021–2024 [1] [2].
2. What CBO did estimate — multi‑year deficit and coverage impacts starting after 2024
CBO’s June 2024 analysis estimated that making the expanded premium tax credit structure permanent would raise the federal deficit by approximately $335 billion over the 2025–2034 period, with $415 billion of increased premium tax credit outlays partially offset by $80 billion of increased revenues and reduced spending elsewhere; CBO also projected roughly 3.4 million more people with insurance under that permanent extension (a marketplace increase of 6.9 million and an employer‑coverage decrease of 3.5 million) and an average subsidy of about $5,370 per newly enrolled marketplace enrollee [1]. A separate CBO product in 2025 produced similar magnitudes, estimating about $350 billion increased deficits over 2026–2035 and projecting 3.8 million more people with insurance in 2035 under a permanent extension [3] [4].
3. What the baseline numbers for 2023–2024 show and why they matter
CBO’s baseline projections provide concrete near‑term figures that contextualize ARPA’s effects even if they don’t represent a “permanent extension cost for 2021–2024.” CBO reported premium tax credit outlays of approximately $70 billion in 2023 and $98 billion in 2024, with revenue reductions of $16 billion in 2024, and projected continued outlays in subsequent years—numbers used to model how an expansion affects federal spending and coverage [2]. These baseline outlays demonstrate that the federal subsidy scale in 2023–2024 was large, but CBO’s scoring practice is to switch to multi‑year windows for permanent policy changes, so near‑term outlays are not presented as a standalone “permanent extension” total for 2021–2024 [2].
4. Why CBO doesn’t provide a direct “2021–2024 permanent” figure and the technical context
CBO’s score convention separates baseline projections from the cost of hypothetical legislative changes enacted at a defined date; permanent policy changes are scored over a subsequent specified window tied to enactment, which is why the agency assessed permanent expansion’s fiscal effects over 2025–2034 or 2026–2035 in the cited reports. The ARPA enhancements were enacted in 2021 as temporary law, and CBO’s analyses in 2024 and 2025 reflect the agency’s effort to simulate making that temporary policy permanent starting at later dates. Therefore, asking for CBO’s estimate “for 2021–2024” misunderstands how the agency constructs scores for permanent enactments versus baseline outlays for specific prior years [1] [5].
5. Alternative readings and later CBO reports — consistent magnitudes, different windows
Independent summaries and CBO follow‑ups in 2025 reiterate the same pattern: permanent extension increases deficits by roughly $335–$350 billion across a ten‑year window that begins after 2024, and increases insurance coverage by roughly 3.4–3.8 million people at the horizon year cited by each report. CBO additionally estimated the shorter effects of one‑ or two‑year extensions (for example, increasing deficits by about $23.4 billion for a one‑year extension in 2026 and $55.3 billion for two years across 2026–2027) to illustrate how different enactment durations affect near‑term scoring [5] [4]. The differences across CBO products are largely calendar‑window choices rather than fundamental disagreements about scale.
6. Bottom line — What to report if asked for a 2021–2024 CBO number
CBO did not issue a direct figure that sums the cost of permanently extending ARPA’s enhanced premium tax credits specifically for 2021–2024; instead, it provided baseline outlays for 2023–2024 and produced permanent‑extension cost estimates across later ten‑year windows (roughly $335–$350 billion net deficit increase and ~3.4–3.8 million additional insured in the horizon year) depending on the enactment date used in the scoring. If a precise 2021–2024 number is required, that would not be a standard CBO permanent‑policy score and would require a bespoke retrospective accounting that CBO did not publish in those reports [1] [2] [3].