The enhanced subsidies were put into place under the 2021 American Rescue Plan, which made ACA plans affordable for many middle-class families.
The trade-off: While the monthly premiums are typically lower, they’d have to shoulder higher out-of-pocket costs before coverage kicks in.
Of those, more than 9 in 10 — 22.3 million people — qualified for the enhanced subsidies.
Without the enhanced subsidies, the amount the government pays toward their monthly premiums will shrink.
A June report from KFF finds that 3 in 4 adults support extending the enhanced subsidies, including two-thirds of Republicans.
Just $278 a month is all that Leighanne Safford and her husband, Lorry, pay for health insurance. Beginning in January, however. 1. Their monthly premium might increase to $1,800.
Millions of people, including Safford’s family, may have to pay hundreds more for health insurance premiums next year when the enhanced Affordable Care Act subsidies run out at the end of December.
The 2021 American Rescue Plan implemented the increased subsidies, making ACA plans accessible to a large number of middle-class families. Through 2025, the subsidies were extended by the Inflation Reduction Act of 2022.
However, neither of the two significant funding bills that the Republican-controlled Congress has passed this year included an extension of the subsidies. Republicans may or may not include an extension in a bill to ensure government funding by September. 30.
For Safford, the impact might be exacerbated by Medicaid expansion rollbacks in the massive legislative bill signed into law by President Donald Trump this summer. The family also intends to pay for Adam’s health insurance in 2026 because she is worried that her 13-year-old son might lose his Medicaid coverage.
Safford claimed that without reducing their spending on necessities like food or dental care, they would not be able to pay the $1,800 monthly premium, which only covers her and her spouse. Instead, they want to move to a more affordable, high-deductible plan that would provide family coverage. The trade-off: Although monthly premiums are usually lower, they would have to pay more out of pocket before coverage begins.
“At the moment, we’re deciding because all three of us are reasonably healthy,” Safford stated. However, as everyone knows, things can change at any time when it comes to health. “.”.
Data from the health policy research group KFF shows that in 2025, over 24 million people obtained health insurance through the Affordable Care Act. Over 90% of those, or 22.3 million people, were eligible for the increased subsidies. The ACA’s standard subsidies for extremely low incomes, which went into effect in 2014 and are anticipated to remain in place, are also included in that number. ).
In Mississippi, Florida, West Virginia, Oklahoma, Louisiana, Utah, and Alabama, enhanced subsidies were provided to at least 96% of ACA enrollees. The lowest rates were found in Washington state (73 percent) and New Hampshire (71 percent).
The Congressional Budget Office, the nonpartisan organization that advises Congress on budget and economic matters, calculated in 2024 that if the enhanced subsidies expire, almost 4 million people will not have insurance in 2026 because they cannot afford the premiums. That figure is predicted to soar to nearly 7 million by 2034.
“Millions will lose their insurance if Congress does nothing,” stated Edwin Park, a research professor at Georgetown University’s McCourt School of Public Policy. “It will be far more expensive without these subsidies. “”.
A double whammy.
Enrollment for the ACA plans for the following year opens in November. 1.
But when official notices detailing the monthly premiums for the upcoming year arrive in their mailboxes in October, many families will experience “sticker shock,” according to Jessica Altman, executive director of Covered California, a state-based marketplace for ACA coverage.
She said, “There’s a lot of fear.”. “That could be someone who has cancer or another chronic illness and knows they need it, or someone who thinks they might have to just cross their fingers and go without.”. ‘”.
According to Altman, a family of four in Sacramento County making $113,000 annually might see a $1,550 increase in their monthly premium if government subsidies end, as opposed to just $112 if they continue.
In addition to the subsidies’ expiration, states also need to account for anticipated increases in insurer premiums the following year.
Altman characterized the situation as “a double whammy of premiums going up and then tax credits potentially going down.”. According to a KFF report, insurers offering ACA plans anticipate raising premiums by an average of about 18 percent nationwide. S. . regarding 2026. People might pay an average of 75% more in premiums if subsidies were eliminated, according to KFF.
Additionally, Cynthia Cox, vice president and director of the ACA program at KFF, stated that those who are still eligible for the regular ACA subsidies will not be exempt. The government’s contribution to their monthly premiums will decrease in the absence of the increased subsidies.
“It will have a fairly wide-ranging effect,” Cox stated. “Almost everyone who purchases their own health insurance will experience some sort of impact from this. “”.
Dr. David Zonies, who practices in Safford, Washington state, stated that many of his patients will be directly impacted. Zonies serves as the medical director of Harborview Medical Center, a safety net facility at the University of Washington that primarily treats Medicaid and ACA patients.
Along with the Medicaid cuts, the loss of the enhanced subsidies means that many patients will not have insurance and will put off getting the care they require until it gets much worse, he said.
“The loss of these tax credits is my biggest worry right now,” Zonies stated. We predict that things will essentially return to how they were prior to the passage of the Affordable Care Act, which will be disastrous. “”.
An inquiry was not answered by a representative of AHIP, the primary industry trade association that advocates for insurers, including those that offer ACA plans.
A struggle to increase subsidies.
Congress may still decide to extend the increased subsidies, according to Park, either as a stand-alone bill or as part of a larger government funding package. September marks the expiration of the most recent government spending bill. 30.
“It is really hard to forecast,” he stated.
Many Republicans remained opposed to the subsidies being extended, while Democrats persisted in their support.
However, John Thune, R-S, the Senate majority leader. A. stated to NBC News earlier this month that he is keeping the possibility of an extension open.
While blaming Democrats for both the program’s expansion and the phaseouts of the subsidies, Thune acknowledged that “some of our members are paying attention to it.”.
R-La. House Speaker Mike Johnson. remains ambivalent on the matter, but he has also left the possibility of a funding extension open.
Altman stated that Congress must act swiftly to decide what it wants to do, adding that an extension would give many families “peace of mind” as well as financial and health care security.
According to a KFF report from June, two-thirds of Republicans and three out of four adults favor keeping the increased subsidies in place.
However, Park stated that the increased subsidies that Republicans passed might differ from the ones that the Democrats had in place before.
“If Republicans in Congress are willing to negotiate an extension of the enhanced credits, I do anticipate that they will try to lessen the generosity of the enhanced subsidies,” he stated.
According to Cox, the majority of families, including Safford’s family, will probably switch to high-deductible plans, while some may choose to maintain their coverage by making financial sacrifices. These plans are intended to protect against enormous medical bills that can be financially ruinous, even though members must pay more out of pocket before coverage begins.
“Suppose you are struck by a bus, you develop cancer, or you require some very costly medical care. According to Cox, such a plan would protect you from those extremely high hospital expenses.
She is still “knocking on wood” that the subsidies will be extended, according to Safford.
She claimed that if they weren’t extended, “it would take away from our life.”.
