As we head into 2026, about 22 million people who rely on the Affordable Care Act marketplace for their health care are about to see their premiums spike, barring a last-minute workaround, with subsidies known as “enhanced premium tax credits” set to expire on Dec. 31.
Experts say everyone who’s been getting those credits are looking get an increase. According to the Bush School of Government at Texas A&M, that’s about 4 million Texans facing higher premiums, after enrollment quadrupled over the past four years.
When it comes to the end of these subsidies, some folks will be hit harder than others.
Paige Winfield Cunningham, who covers health policy for the Washington Post, joined Texas Standard to break it all down.
How did we get here?
Cunningham says congressional Democrats passed legislation to enhance the subsidies amid the COVID-19 pandemic, making the plans more affordable for people.
The subsidies were then extended once and, as the expiration date loomed, Congress debated over the last six months whether or not to extend them once again.
“I think what happened is consumers really got used to having these extra subsidies. And so now that they’re going away, and combined with premium increases, we’re seeing that there’s going to be a huge affordability concern as people see the subsidies going away,” Cunningham said.
Republicans, Cunningham says, have criticized the subsidies as expensive and intended to only be around for the pandemic.
“As of now, there is no bipartisan legislation that has been passed by Congress to extend them,” Cunningham said.
Can anything be done to save the subsidies?
Cunningham says it’s unlikely something can be done to save the subsidies at the last minute.
Four House Republicans joined Democrats to force a bill onto the House floor for a Jan. 5 vote that would extend the subsidies three years, but the bill would still need to pass the Senate even if it advances.
“And even if that happened, consumers are still going to see big costs go up in January,” Cunningham said.
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Who will be most affected if the subsidies expire?
Cunningham says the impact of the subsidies ending would be felt mostly depending upon one’s income. Those enrolled in the ACA largely are without employer-sponsored coverage, and Cunningham breaks those impacted down into three groups of people.
• Lower-income tier: Those who make between $16,000 and $23,000 a year.
People in this group had been getting their premiums fully covered by the extra subsidies, Cunningham said, but will now need to start paying toward their monthly premium with some of their own money.
“It’s not going to be a huge amount, but they’re probably going to see something under $100 a month that they’re gonna have to pay,” Cunningham said.
• Middle tier: Those who make between $23,000 and $63,000 a year.
Cunningham says people in this tier can expect the sum they had been paying to go up by tens or hundreds of dollars.
• Higher-income tier: Those who earn more than $63,000 a year.
Cunningham says this is the tier that will be most affected, because the original Affordable Care Act did not provide any government assistance to people in this tier. It was only through the extra subsidies that this tier saw a benefit toward their premiums.
With the extra subsidies expiring, Cunningham says they will be fully exposed to premium spikes.
“In fact, I talked to people in this income category who are seeing their premiums go up by thousands of dollars a month,” Cunningham said. “So for this group, it’s really an untenable situation and they’re very concerned about how they’re even going to retain coverage.”
Is there anything that can be done to minimize impact?
Cunningham says one option people can look at to avoid a premium spike is to switch to a lower-tier plan.
The marketplace offers gold, silver and bronze plans. The higher the tier, the more benefits one receives, but also the higher premium. So, switching from a silver to a bronze plan would lower one’s monthly premium, for example.
“But of course, consumers should also recognize that if they do that, they’re probably also going to have to pay more money out of pocket when they visit the doctor or need a medical service,” Cunningham said.
