Affordable Care Act in the context of "Tea Party movement"

Modern liberalism, often referred to simply as liberalism, is the dominant ideological variant of liberalism in the United States. It is most synonymous with the ideology of social liberalism, which is a variant of liberalism that moves beyond classical liberalism to account for poverty, seeking a balance between civil liberty and social equality via a social safety net. U.S. modern liberalism also takes inspiration from cultural liberalism and progressivism, and some (but not all) modern liberals explicitly identify with the contemporary U.S. progressive movement. Writing in 1993, American academic writer Ian Adams argued all major U.S. parties up to that point were "liberal and always have been. Essentially they espouse classical liberalism, that is a form of democratized Whig constitutionalism plus the free market. The point of difference comes with the influence of social liberalism."

Economically, modern liberalism accepts a role for government to protect against market failures, protect competition and prevent corporate monopolies, and supports labor rights. Its fiscal policy supports sufficient funding for a social safety net, while simultaneously promoting income-proportional tax reform policies to reduce deficits. It calls for active government involvement in other social and economic matters such as reducing economic inequality, expanding access to education and healthcare, and protection of the shared natural environment, in large part on the contention that advances in those areas create a thriving economy in the long run. Modern liberalism was formed in the 20th century in response to the Great Depression. Major examples of modern liberal policy programs include the New Deal, the Fair Deal, the New Frontier, the Great Society, the Affordable Care Act, and the Build Back Better Plan.

The Internal Revenue Service (IRS) is the revenue service for the United States federal government, which is responsible for collecting U.S. federal taxes and administering the Internal Revenue Code, the main body of the federal statutory tax law. It is an agency of the Department of the Treasury and led by the commissioner of Internal Revenue, who is appointed to a five-year term by the president of the United States. The duties of the IRS include providing tax assistance to taxpayers; pursuing and resolving instances of erroneous or fraudulent tax filings; and overseeing various benefits programs, including the Affordable Care Act.

The IRS originates from the Office of Commissioner of Internal Revenue, a federal office created in 1862 to assess the nation's first income tax to fund the American Civil War. The temporary measure funded over a fifth of the Union's war expenses before being allowed to expire a decade later. In 1913, the Sixteenth Amendment to the U.S. Constitution was ratified, authorizing Congress to impose a tax on income and leading to the creation of the Bureau of Internal Revenue. In 1953, the agency was renamed the Internal Revenue Service, and in subsequent decades underwent numerous reforms and reorganizations, most significantly in the 1990s.

Healthcare in the United States is largely provided by private sector healthcare facilities, and paid for by a combination of public programs, county indigent health care programs, private insurance, and out-of-pocket payments. The U.S. is the only developed country without a system of universal healthcare, and, as of 2023, 7.9% of the population does not have health insurance. The United States spends more on healthcare than any other country, both in absolute terms and as a percentage of GDP; however, this expenditure does not necessarily translate into better overall health outcomes compared to other developed nations. In 2022, the United States spent approximately 17.8% of its Gross Domestic Product (GDP) on healthcare, significantly higher than the average of 11.5% among other high-income countries. Coverage varies widely across the population, with certain groups, such as the elderly, disabled and low-income individuals receiving more comprehensive care through government programs such as Medicaid and Medicare.

The U.S. healthcare system has been the subject of significant political debate and reform efforts, particularly in the areas of healthcare costs, insurance coverage, and the quality of care. Legislation such as the Affordable Care Act of 2010 has sought to address some of these issues, though challenges remain. Uninsured rates have fluctuated over time, and disparities in access to care exist based on factors such as income, race, and geographical location. The private insurance model predominates, and employer-sponsored insurance is a common way for individuals to obtain coverage.

Medicaid is a government program in the United States that provides health insurance for adults and children with limited income and resources. The program is partially funded and primarily managed by state governments, which also have wide latitude in determining eligibility and benefits, but the federal government sets baseline standards for state Medicaid programs and provides a significant portion of their funding. States are not required to participate in the program, although all have since 1982.

Medicaid was established in 1965, part of the Great Society set of programs during President Lyndon B. Johnson's Administration, and was significantly expanded by the Affordable Care Act (ACA), which was passed in 2010. In most states, any member of a household with income up to 138% of the federal poverty line qualifies for Medicaid coverage under the provisions of the ACA. A 2012 Supreme Court decision established that states may continue to use pre-ACA Medicaid eligibility standards and receive previously established levels of federal Medicaid funding, which led some Republican-controlled states to not expand Medicaid coverage. The 2025 One Big Beautiful Bill Act established requirements that will begin in 2027 for most able-bodied adult Medicaid enrollees to work or volunteer for 80 hours per month in order to maintain coverage.

Medicare Part D, also called the Medicare prescription drug benefit, is an optional United States federal-government program to help Medicare beneficiaries pay for self-administered prescription drugs. Part D was enacted as part of the Medicare Modernization Act of 2003 and went into effect on January 1, 2006. Under the program, drug benefits are provided by private insurance plans that receive premiums from both enrollees and the government. Part D plans typically pay most of the cost for prescriptions filled by their enrollees. However, plans are later reimbursed for much of this cost through rebates paid by manufacturers and pharmacies.

Part D enrollees cover a portion of their own drug expenses by paying cost-sharing. The amount of cost-sharing an enrollee pays depends on the retail cost of the filled drug, the rules of their plan, and whether they are eligible for additional Federal income-based subsidies. Prior to 2010, enrollees were required to pay 100% of their retail drug costs during the coverage gap phase, commonly referred to as the "doughnut hole.” Subsequent legislation, including the Affordable Care Act, “closed” the doughnut hole from the perspective of beneficiaries, largely through the creation of a manufacturer discount program.