SMOOTH Payments Act
- Sponsor
- Rep. Bean, Aaron [R-FL-4]
- Committees
- Ways and Means Committee (primary)
- Last action
- Jun 25, 2026
Bottom line
This bill aims to make health insurance cost-sharing more predictable and manageable for consumers by linking premium tax credit eligibility to the availability of plans with monthly capped cost-sharing payments.
What it actually does
This bill amends the Internal Revenue Code of 1986 to restrict eligibility for the premium tax credit. Individuals can only receive the credit if they enroll in a qualified health plan offered by a health insurance issuer that provides at least one plan allowing enrollees to pay $0 upfront for services and then pay their total cost-sharing amounts in capped monthly installments, similar to Medicare Part D's catastrophic coverage phase.
Proponents argue
Proponents would argue that this bill addresses a significant barrier to healthcare access and affordability by smoothing out unpredictable out-of-pocket costs. By allowing individuals to pay cost-sharing in predictable monthly installments, it helps prevent unexpected medical bills from becoming financial crises, thereby making healthcare more accessible and financially manageable for those relying on premium tax credits.
Opponents contend
Opponents might contend that this bill could inadvertently limit consumer choice by imposing new requirements on health insurance issuers, potentially leading some issuers to withdraw from the market or reduce the variety of plans offered. They might also argue that it could increase administrative burdens for insurers, which could be passed on to consumers through higher premiums, or that it creates an unfunded mandate on insurers to offer a specific type of payment option.
The bill is very short and straightforward to read, allowing ample time for evaluation.
Section 2(a), amending Section 36B(c)(3)(A)(i) of the Internal Revenue Code of 1986
Requirement for Health Insurance Issuers to Offer Monthly Cost-Sharing Payment Options for Premium Tax Credit Eligibility
This provision modifies the definition of a 'qualified health plan' for the purpose of receiving the premium tax credit. Under the change, an individual can only receive the premium tax credit if their health insurance issuer offers at least one plan that allows enrollees to pay no cost-sharing at the point of service and instead pay their total cost-sharing amounts in capped monthly installments, similar to Medicare Part D's catastrophic coverage phase or as prescribed by the Secretary of Health and Human Services.
Supporters argue
Supporters argue this provision directly addresses the financial strain unexpected medical costs place on families, particularly those with lower incomes. By mandating a monthly cost-sharing payment option, it makes healthcare budgets more predictable and prevents individuals from delaying necessary care due to upfront cost concerns.
Critics contend
Critics might argue that this mandate could increase administrative complexity and costs for health insurance issuers, potentially leading to higher premiums for all consumers or a reduction in the number of plans offered on the marketplace, thereby limiting consumer choice.
Tradeoffs
The provision balances the goal of making healthcare costs more predictable for consumers against the potential for increased regulatory burden and reduced plan diversity for health insurance issuers.
Section 2(b)
Effective Date
This section specifies that the changes made by the bill will take effect for taxable years beginning after December 31, 2026. This provides health insurance issuers and the IRS with over a year to prepare for the new requirements.
The bill specifies that the monthly cost-sharing payments should be 'capped in a manner similar to the manner provided in subparagraph (E) of section 1860D-2(b)(2) of the Social Security Act, or in any other manner prescribed by the Secretary of Health and Human Services.'
Section 2(a)(II)(bb)
Why it matters:This is standard legislative practice to avoid reprinting lengthy statutory language and to leverage existing, understood mechanisms. However, it requires a reader to look up external code to grasp the full implications.
Case for: Proponents would argue that referencing an existing, well-understood mechanism like the Medicare Part D catastrophic coverage cap provides clarity and consistency, leveraging established administrative frameworks.
Case against: Critics might argue that such cross-references make the bill less transparent and harder for the average person to understand without specialized legal or policy research.
Estimated impact: This reference defines the type of financial protection offered, potentially affecting the financial stability of millions of enrollees by limiting their monthly out-of-pocket exposure.