Open enrollment for coverage under the Affordable Care Act (ACA) for 2026 has commenced, causing millions to confront stark increases in health insurance premiums. This shift is largely attributed to the impending expiration of enhanced premium subsidies that have been in place since 2021.
These enhanced subsidies, which provided financial relief to lower-income Americans, have allowed many to secure health insurance policies with little to no monthly premium payments. The expiration of these subsidies, scheduled for the end of the year, could significantly impact those who rely on them, particularly lower-income individuals, older adults, and middle-class families.
According to the Kaiser Family Foundation (KFF), a nonpartisan health policy research organization, average premiums could more than double due to the combination of rising insurance costs and the withdrawal of these financial supports. The enhanced tax credits were initially introduced by a Democratic-led Congress during the COVID-19 pandemic and were renewed in subsequent years, leading to an unprecedented 24 million sign-ups for 2025. Notably, over 90% of enrollees currently benefit from premium assistance, which allows approximately half of them to pay little to nothing for their monthly premiums.
The Congressional Budget Office has projected that if these subsidies are allowed to expire, around 4 million more individuals could find themselves uninsured by 2034. Much of the recent enrollment growth has been concentrated in Southern states, where Medicaid has not been expanded to cover low-income adults. The enhanced subsidies have been instrumental in providing these residents—who often earn just above the poverty line—with affordable coverage options.
States such as Texas, Florida, Georgia, and North Carolina account for about half of the enrollment increases since the enhanced subsidies were implemented. Interestingly, many of the current enrollees reside in areas that supported former President Trump in the 2024 election, or in congressional districts held by Republican lawmakers.
Debate continues in Congress regarding the renewal of these enhanced subsidies. The divide between Democrats and Republicans has hindered any progress towards approving a federal funding package for the ongoing fiscal year, leading to a government shutdown as of October 1. This deadlock has extended beyond the previous record of 35 days without a resolution.
Democrats insist that any federal spending legislation must include a renewal of the enhanced subsidies, while Republicans have maintained that negotiations cannot occur until the government is fully reopened. Initially, both parties saw significant public support for extending the subsidies. However, as the shutdown continues, support—particularly among Republican constituents—has begun to wane, complicating efforts to reach a compromise.
