Healthcare Subsidies Expire, Leaving Millions of Americans with Higher Costs
The enhanced tax credits that helped reduce the cost of health insurance for the vast majority of Affordable Care Act (ACA) enrollees have expired, resulting in higher health costs for millions of Americans. This change affects a diverse group of people, including self-employed workers, small business owners, farmers, and ranchers, who do not get their health insurance from an employer and do not qualify for Medicaid or Medicare.
According to an analysis by the health care research nonprofit KFF, the more than 20 million subsidized enrollees in the ACA program are seeing their premium costs rise by 114% in 2026. This significant increase in healthcare costs comes at the start of a high-stakes midterm election year, with affordability, including the cost of healthcare, being a top concern for voters.
Subsidies Helped Reduce Costs Since the Pandemic
The expired subsidies were first introduced in 2021 as a temporary measure to help Americans get through the COVID-19 pandemic. Democrats in power at the time extended them, moving the expiration date to the start of 2026. With the expanded subsidies, some lower-income enrollees received health care with no premiums, and high earners paid no more than 8.5% of their income. Eligibility for middle-class earners was also expanded.
Those surging prices come alongside an overall increase in health costs in the U.S., which are further driving up out-of-pocket costs in many plans. Some enrollees, like Salt Lake City freelance filmmaker and adjunct professor Stan Clawson, have absorbed the extra expense. Clawson said he was paying just under $350 a month for his premiums last year, a number that will jump to nearly $500 a month this year.
Many Expected to Go Without Coverage
Health analysts have predicted that the expiration of the subsidies will drive many of the 24 million total ACA enrollees, especially younger and healthier Americans, to forgo health insurance coverage altogether. Over time, this could make the program more expensive for the older, sicker population that remains.
An analysis conducted last September by the Urban Institute and Commonwealth Fund projected that the higher premiums from expiring subsidies would prompt some 4.8 million Americans to drop coverage in 2026. The impact could be greatest in Florida, which has the largest number of ACA enrollees of any state — more than 4.7 million, according to KFF data.
Kylie Barrios, a 30-year-old Florida resident, said she expected to be among those losing coverage. “Our health insurance premium is effectively tripling from 2025 to 2026,” she told CBS News in December, saying it would rise from about $900 to $2,500.
Conclusion and Next Steps
With the window to select and change plans still ongoing until Jan. 15 in most states, the final effect on enrollment is yet to be determined. Last year, after Republicans cut more than $1 trillion in federal health care and food assistance with Mr. Trump’s big tax and spending cuts bill, Democrats repeatedly called for the subsidies to be extended. But while some Republicans in power acknowledged the issue needed to be addressed, they refused to put it to a vote until late in the year.
In December, the Senate rejected two partisan health care bills — a Democratic pitch to extend the subsidies for three more years and a Republican alternative that would instead provide Americans with health savings accounts. In the House, four centrist Republicans broke with GOP leadership and joined forces with Democrats to force a vote that could come as soon as January on a three-year extension of the tax credits.
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