ACA Subsidies Expire, Millions Face Higher Health Insurance Premiums
Enhanced Affordable Care Act subsidies have expired, leading to anticipated premium increases for millions of Americans.
Enhanced Affordable Care Act (ACA) subsidies, which have provided financial assistance to millions of Americans, expired at midnight on December 31, 2025. This expiration is expected to result in significant increases in health insurance premiums for many individuals.
The subsidies, initially introduced during the Obama administration and expanded during the COVID-19 pandemic, aimed to lower or eliminate monthly premium costs for those purchasing coverage through the health insurance marketplace. Approximately 22 million of the 24 million ACA marketplace enrollees have been benefiting from these enhanced premium tax credits.
In the months leading up to the expiration, Congress faced challenges in reaching a consensus to extend the subsidies. In December 2025, the Senate rejected both Democratic and Republican proposals to address the issue, raising the likelihood that these enhanced tax credits would expire by year-end.
House Minority Whip Katherine Clark (D-Mass.) expressed concern over the situation, stating, "The ACA tax credits expire at midnight. Millions will see their premiums skyrocket because Republicans refused to act. You deserve better, and Democrats will keep fighting to lower costs."
The Congressional Budget Office projects that, without an extension, gross benchmark premiums—the price of a standard plan before government subsidies are applied—could increase by 4.3% in 2026 and by 7.7% in 2027 for those on marketplace plans.
Individuals like Doug Butchart from Illinois are facing uncertainty. With his wife, Shadene, diagnosed with amyotrophic lateral sclerosis (ALS), Butchart noted that her monthly premiums will climb to more than $2,000, which they "can't afford." They've switched to a cheaper plan, but it will still be a struggle to cover costs, he said.
The House is expected to vote on a Democrat-led bill in January that would extend the enhanced premium tax credits by three years. However, the outcome remains uncertain as political divisions persist.
The expiration of these subsidies underscores the ongoing debate over healthcare affordability and access in the United States, with millions of Americans now facing potential financial strain due to rising insurance costs.