FOR PROFIT HEALTHCARE
More than 20 million people in the United States will face sharply higher health insurance costs as of January 1 after enhanced tax credits that helped enrollees in the Affordable Care Act afford coverage expired overnight. The expiration of the subsidies will mostly affect families, small business owners and self-employed workers.
Issued on: 01/01/2026
By: FRACE 24
US Capitol is seen shortly after sunrise, December 16, 2025, in Washington. © Julia Demaree Nikhinson, AP
Enhanced tax credits that have helped reduce the cost of health insurance for the vast majority of Affordable Care Act (ACA, also known as "Obamacare") enrollees expired overnight, cementing higher health costs for millions of people in the United States at the start of the new year.
The change affects a diverse cross-section of the population who don’t get their health insurance from an employer and don’t qualify for Medicaid or Medicare – a group that includes many self-employed workers, small business owners, farmers and ranchers.
On average, the more than 20 million subsidised enrollees in the Affordable Care Act programme are seeing their premium costs rise by 114 percent in 2026, according to an analysis by the healthcare research nonprofit KFF.
The subsidies were first given to Affordable Care Act enrollees in 2021 as a temporary measure to help US residents get through the Covid-19 pandemic. Democrats in power at the time then extended them, pushing the expiration date to the start of 2026. Some lower-income enrollees received health care with no premiums, and high earners paid no more than 8.5 percent of their income. Eligibility for middle-class earners was also expanded.
Democrats forced a 43-day government shutdown over the issue, demanding the health subsidies be extended before they agreed to a new Republican budget. Some Republicans also called for a bipartisan solution to save their 2026 political aspirations, given the ACA's popularity – two-thirds of Americans favour the system, according to KFF.
But while congressional Republicans acknowledged the issue needed to be addressed, they refused to put it to a vote until late in the year. A House vote expected in January could offer another chance, but success is far from guaranteed.
Health analysts have predicted the expiration of the subsidies will drive many of the 24 million total Affordable Care Act enrollees – especially younger and healthier Americans – to forgo health insurance coverage altogether.
Over time, that could make the programme more expensive for the older, sicker population that remains.
Enhanced tax credits that have helped reduce the cost of health insurance for the vast majority of Affordable Care Act (ACA, also known as "Obamacare") enrollees expired overnight, cementing higher health costs for millions of people in the United States at the start of the new year.
The change affects a diverse cross-section of the population who don’t get their health insurance from an employer and don’t qualify for Medicaid or Medicare – a group that includes many self-employed workers, small business owners, farmers and ranchers.
On average, the more than 20 million subsidised enrollees in the Affordable Care Act programme are seeing their premium costs rise by 114 percent in 2026, according to an analysis by the healthcare research nonprofit KFF.
The subsidies were first given to Affordable Care Act enrollees in 2021 as a temporary measure to help US residents get through the Covid-19 pandemic. Democrats in power at the time then extended them, pushing the expiration date to the start of 2026. Some lower-income enrollees received health care with no premiums, and high earners paid no more than 8.5 percent of their income. Eligibility for middle-class earners was also expanded.
Democrats forced a 43-day government shutdown over the issue, demanding the health subsidies be extended before they agreed to a new Republican budget. Some Republicans also called for a bipartisan solution to save their 2026 political aspirations, given the ACA's popularity – two-thirds of Americans favour the system, according to KFF.
But while congressional Republicans acknowledged the issue needed to be addressed, they refused to put it to a vote until late in the year. A House vote expected in January could offer another chance, but success is far from guaranteed.
Health analysts have predicted the expiration of the subsidies will drive many of the 24 million total Affordable Care Act enrollees – especially younger and healthier Americans – to forgo health insurance coverage altogether.
Over time, that could make the programme more expensive for the older, sicker population that remains.
Rising costs across the board
The surging healthcare prices come alongside an overall increase in health costs in the US, which are further driving up out-of-pocket costs in many plans.
It also comes at the start of a high-stakes midterm election year, with affordability – including the cost of health care – topping the list of voters’ concerns.
“It really bothers me that the middle class has moved from a squeeze to a full suffocation, and they continue to just pile on and leave it up to us,” said 37-year-old single mom Katelin Provost, whose healthcare costs are set to jump. “I’m incredibly disappointed that there hasn’t been more action.”
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. It’s a strain for the 49-year-old, but one he’s willing to take on because he needs health insurance as someone who lives with paralysis from a spinal cord injury.
Others, like Provost, are dealing with steeper hikes. The social worker’s monthly premium payment is increasing from $85 a month to nearly $750.
An analysis conducted last September by the Urban Institute and Commonwealth Fund projected the higher premiums from expiring subsidies would prompt some 4.8 million Americans to drop coverage in 2026.
But with the window to select and change plans still ongoing until January 15 in most states, the final effect on enrollment is yet to be determined.
Provost said she is holding out hope that Congress finds a way to revive the subsidies early in the year – but if not, she’ll drop herself off the insurance and keep it only for her 4-year-old daughter.
She can’t afford to pay for coverage for both of them without the subsidies.
After Republicans cut more than $1 trillion in federal healthcare and food assistance by passing Trump’s big tax and spending cuts bill, Democrats repeatedly called for the ACA subsidies to be extended.
In December, the GOP-controlled Senate rejected two partisan healthcare 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 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. But with the Senate already having rejected such a plan, it’s unclear whether it could get enough momentum to pass.
Meanwhile, Americans whose premiums are skyrocketing say lawmakers don’t understand what it’s really like to struggle to get by as health costs ratchet up with no relief.
Many say they want the subsidies restored alongside broader reforms to make health care more affordable for all Americans.
“Both Republicans and Democrats have been saying for years, oh, we need to fix it. Then do it,” said Chad Bruns, a 58-year-old Affordable Care Act enrollee in Wisconsin. “They need to get to the root cause, and no political party ever does that.”
(FRANCE 24 with AP)
1 day ago
BBC
Ana Faguy
Ana Faguy
Adrienne Martin
Adrienne Martin faced a difficult choice after her monthly healthcare premium increased dramatically
Adrienne Martin and her family are starting the New Year off without healthcare.
The 47-year-old Texas mother had to make a difficult choice when she found out her monthly healthcare premium was increasing in 2026 from what she described as a manageable $630 (£467) to an unaffordable $2,400 (£1,781).
Her husband depends on an IV medication to treat a blood-clotting disease that costs $70,000 a month without insurance. Knowing their benefits would expire, the family stockpiled the drug to survive the first few months of the year.
"It would be like paying two mortgage payments," she said of the new monthly price for healthcare. "We can't pay $30,000 for insurance a year."
Ms Martin and her family are not the only ones facing this conundrum. Millions of Americans will see their healthcare bills skyrocket when these subsidies, which were provided through the Affordable Care Act (ACA), also known as Obamacare, expire.
Some members of Congress on both sides of the aisle attempted to extend these subsidies into 2026, but Washington was gridlocked. A vote in the new year could offer hope, but until then, many like Ms Martin will have to live without insurance or see their bills steeply increase.
About 24 million Americans buy health insurance through the ACA marketplace, and the majority were used to receiving tax credits to lower the monthly price.
Those tax credits, also referred to as subsidies, were first introduced through former President Barack Obama's ACA in 2014. They were then expanded during Covid.
The fight to extend the subsidies became the centre of the longest government shutdown in US history, which went on for more than 40 days earlier this year.
Democrats wanted to force Republicans to extend the subsidies for an additional three years, which would cost $35bn per year. Republicans did not want the government to foot the bill for another three years of subsidies without spending cuts.
The weeks-long shutdown - which left millions without essential government services - ended when a group of Democratic senators agreed to reopen the government, if Republicans in the Senate agreed to vote on extending the subsidies.
But that vote still hasn't happened yet, despite efforts from Democrats and four Republicans to put the issue to Congress before the subsidies expired.
"I am pissed for the American people," New York Congressman Mike Lawler, a Republican who pushed to save the subsidies, said. "Everybody has a responsibility to serve their district, to their constituents. You know what is funny? Three-quarters of people on Obamacare are in states Donald Trump won."
Without the subsidies, the monthly cost of healthcare could rise by 114% on average, according to health research non-profit KFF.
Adrienne Martin and Stephanie Petersen
Maddie Bannister is among the Americans bracing for that.
The California mother, who just had her second child, was paying $124 a month for her family of three in 2025. Now, with a new baby and no ACA subsidies, she is preparing to pay $908 a month.
"So many people are going to choose to be uninsured because it's cheaper to pay a penalty for being uninsured than it is to have healthcare," she said.
For Ms Bannister's family, the increased cost of healthcare means putting off other spending: "We were saving for a home, and saving money for that is going to take way longer if we have to spend $11,000 a year on healthcare that we barely use."
While Ms Bannister is stomaching her new bill, and Ms Martin is going without healthcare, others are resorting to different government programmes to get their coverage.
For years, Stephanie Petersen used Medicaid - a healthcare program for lower-income Americans - to get healthcare coverage. Just recently, she was able to switch and get her coverage through the ACA - a welcome change for the 38-year-old.
Because her health care is skyrocketing from $75 to $580 a month, she is returning to Medicaid coverage in the New Year.
"I'm trying to stay optimistic but the way things have been going, I'm not hopeful," the Illinois resident said. "Everyone should have affordable, good healthcare, and not have to jump through all these hoops."
A vote on the three-year extension of the ACA subsidies is now expected the week of 5 January when Congress returns to Washington.
Until then, Ms Martin will be one of the more than 27 million Americans without health insurance in 2026.
A number that is likely to grow, experts warn, as healthcare costs increase.
"We're not low-income people, we make decent money, but we can't afford $30,000 a year for insurance, that's crazy," she said.
"We've done everything we're supposed to do, we've worked our whole lives, we work hard, and we just get screwed. The whole system is a nightmare."
Maddie Bannister is among the Americans bracing for that.
The California mother, who just had her second child, was paying $124 a month for her family of three in 2025. Now, with a new baby and no ACA subsidies, she is preparing to pay $908 a month.
"So many people are going to choose to be uninsured because it's cheaper to pay a penalty for being uninsured than it is to have healthcare," she said.
For Ms Bannister's family, the increased cost of healthcare means putting off other spending: "We were saving for a home, and saving money for that is going to take way longer if we have to spend $11,000 a year on healthcare that we barely use."
While Ms Bannister is stomaching her new bill, and Ms Martin is going without healthcare, others are resorting to different government programmes to get their coverage.
For years, Stephanie Petersen used Medicaid - a healthcare program for lower-income Americans - to get healthcare coverage. Just recently, she was able to switch and get her coverage through the ACA - a welcome change for the 38-year-old.
Because her health care is skyrocketing from $75 to $580 a month, she is returning to Medicaid coverage in the New Year.
"I'm trying to stay optimistic but the way things have been going, I'm not hopeful," the Illinois resident said. "Everyone should have affordable, good healthcare, and not have to jump through all these hoops."
A vote on the three-year extension of the ACA subsidies is now expected the week of 5 January when Congress returns to Washington.
Until then, Ms Martin will be one of the more than 27 million Americans without health insurance in 2026.
A number that is likely to grow, experts warn, as healthcare costs increase.
"We're not low-income people, we make decent money, but we can't afford $30,000 a year for insurance, that's crazy," she said.
"We've done everything we're supposed to do, we've worked our whole lives, we work hard, and we just get screwed. The whole system is a nightmare."
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