If there is no bipartisan agreement in Congress by January 1, health care costs will skyrocket in 2026, and several million insured people may face a 70 to 100 percent increase in their monthly premiums, which many simply will not be able to afford. If, because of Trump’s “wonderful” law, tens of millions of insured people who would be paying for health care services, and 911 billion dollars over the next ten years, fall out of the health care system, that could be fatal not only for people’s health, but for the entire health care system as well.
This catastrophic situation was the subject of a press briefing organized by American Community Media with Tomas Bednar, vice president and counsel at Healthsperien LLC, Amber Christ, managing director for Health Advocacy at Justice in Aging, and Sophia Tripoli, director of health policy at Families USA. The crisis came about because the Democratic Party’s attempt to use a government shutdown did not achieve its goal due to eight Democratic senators; they settled for a vague promise, and now no one knows what will happen.
The real stake of the federal government shutdown was whether Obamacare insurance premiums would rise dramatically starting January 1. At the center of the debate are the so-called “enhanced premium tax credits,” the expanded subsidies introduced during the pandemic and extended once already, which genuinely made health care affordable and allowed many people to obtain affordable health insurance. Although this situation originally arose because of the pandemic, and for that reason Republicans want to end it, it has become clear that this is in fact the normal state of affairs, and even this is far from ideal.
This tax credit currently helps about 24 million people keep their marketplace insurance premiums at an affordable level through the federal Obamacare exchanges. This subsidy expires at the end of the year, and the compromise that ended the shutdown only guarantees that there will be a vote on it in December, but there is no guarantee whatsoever that the Republican-controlled Congress will extend it. Eight Democratic senators’ votes were needed for this bad deal, which many Democrats felt was a betrayal, because the bargain was only about the promise of a future vote, not the automatic extension of the subsidies.
On December 11, the Senate will vote on whether to continue the expanded premium tax credits under the Affordable Care Act (ACA), known as Obamacare, which could potentially bring relief to tens of millions of insured people whose monthly health insurance premiums could even double starting January 1, 2026. Senate Democrats have introduced a resolution that would keep the amount of the subsidy in place for the next three years. After the Senate, the House of Representatives will vote on the issue on December 18. Ninety-two percent of the 24 million people are eligible for EPTC, this tax credit.
There is now a huge rush on doctors’ offices, because everyone wants to have all necessary exams done before December 31, since after January 1 everything may cost twice as much or become unaffordable. Tomas Bednar, vice president and counsel at Healthsperien, LLC, predicted that millions of Americans will lose their health insurance if Republicans do not extend the tax credits. As he said, “Never in American history have so few people had health insurance, and this could get even worse.”
The stakes are enormous also because the enhanced subsidies have redrawn the social map of Obamacare. During the pandemic, many low-income families were able to get basic plans for nearly zero monthly premiums, and middle-income people could enter the marketplace without having insurance swallow a major portion of their paychecks. In 2024, the enhanced subsidies reduced affected enrollees’ annual out-of-pocket costs by 705 dollars; without the subsidies, the average annual net premium of 888 dollars would have been 1,593 dollars, more than 75 percent higher. This 75 percent jump is the figure the Democratic Party is now citing, and several fact-checking outlets have confirmed that for many households the difference between having and not having the enhanced subsidies is indeed this large.
Bednar predicted that health care costs will rise for every consumer. Trump’s “One Big Beautiful Act” takes more than 1 trillion dollars out of the Medicaid budget over the next ten years. Bednar noted that the burden shifts to the states, which must either find funding to make up for the federal cuts or eliminate parts of their Medicaid programs and restrict access. All this affects doctor visits, hospital costs, and drug prices as well.
If Congress does not reach an agreement, which is very likely since there is no consensus even among Republicans, then as of January 1 this gap will become reality not just in theory but in practice. If the enhanced subsidies expire, the average annual net premium for those insured on the Obamacare marketplaces would jump from 888 dollars to 1,904 dollars by 2026, a 114 percent increase. In addition, the higher deductible levels under the original law would be reinstated, which means that a family with an annual income of 28,000 dollars would see its out-of-pocket share increase alongside the premiums. Until someone reaches a deductible on the order of ten thousand dollars, which they must pay themselves, the insurer pays virtually nothing. If the enhanced subsidy disappears, people will receive less advance credit toward their insurer and a smaller tax refund at the end of the year. The tax burden rises, the cash in their pockets falls, and insurance premiums spike immediately.
Sophia Tripoli, director of health policy at Families USA, presented her organization’s vision for a fairer and more affordable health care system. In her view, American life has reached a turning point in terms of health care costs. “Most people feel it very personally when their premiums go up, when they get surprise bills, when they are forced to choose between medical care and food,” Tripoli said. As she explained, this is transforming health care. Smaller health care companies and practices will go bankrupt because of the loss of insured patients, large corporations will buy everything up, and they will grow even bigger.
“When corporations get bigger, they have more power to raise prices. Hospitals merge or buy up physician practices and then demand higher rates from insurers. Drug companies maintain patent thickets to keep cheaper generics off the market. Insurers consolidate and narrow provider networks. And consumers do not get better care. Instead, we get higher premiums, higher deductibles, and confusing bills that have nothing to do with the cost of care,” Tripoli said.
Those most at risk are lower- and middle-income enrollees between 50 and 64, who are not yet eligible for Medicare, but because of their age already face higher marketplace premiums and generally depend on medications and health care. According to estimates by the Congressional Budget Office, the expiration of the enhanced subsidies could push several million people out of the insurance system, and a recent academic study predicts around 7 million people could lose coverage nationwide on a lasting basis. The impact will not be uniform: in southern and rural states, where wages are lower and more people have fallen out of Medicaid yet remain poor, the price shock may be particularly severe. In West Virginia, the annual net premium for some households could rise by 300 to 400 percent if the subsidies disappear.
The question is what kind of chain reaction all this triggers in the health care system. According to an analysis by the Medicare Rights Center, many of those who fall off the Obamacare marketplaces will end up completely uninsured and only go to a doctor or hospital when their condition is already very serious. For hospitals and emergency rooms, this means that the volume of uncompensated care will increase, putting more financial pressure on institutions. If there are fewer paid visits and more unpaid emergency cases in the system, preventable diseases will also worsen; ultimately the population’s health declines even as less money flows into the system.
The social impact falls especially hard on minorities. Black and Latino populations are overrepresented in Obamacare and Medicaid; they are the ones who already struggle to pay health care costs after the pandemic and inflation. During the current open enrollment period, while the government is running ad campaigns urging people to sign up, no one knows exactly what premiums they will actually pay next year, because Congress’s delay leaves the legal framework itself uncertain. If there is still no agreement by January 1, tens of millions may find that the insurance sold to them as “affordable” in December becomes unaffordable luxury on the very next bill.
The Democratic Party is demanding that the enhanced subsidies be extended for at least three years in a clean form, without any ideological conditions such as abortion exclusions or new income caps. Only this can prevent a premium explosion and mass loss of coverage, and according to public opinion polls, a majority of Americans support maintaining the Obamacare subsidies. Democrats fear that if they yield now, the Republican majority will attach conditions to the subsidies that narrow the pool of eligible people, shrink the scope of covered benefits, and push precisely the most vulnerable out of the system. They will invent tricks that make it look as if nothing is being cut, while in reality many people will be shut out by the new conditions.
There is no unity within the Republican Party either. Some moderate senators and representatives, especially those who represent suburban districts with many Obamacare enrollees, are afraid that the expiration of the subsidies will trigger an immediate political backlash, and that in the 2026 midterm elections they will be blamed for raising premiums. The party’s health policy “hawks,” on the other hand, see the enhanced subsidies as the antechamber of “socialist medicine,” and at most are willing to consider a short, one-year extension in exchange for major concessions. Republican Senator Bill Cassidy, for example, has put forward a plan that would divert part of the subsidies into health savings accounts and steer people toward cheaper plans with less protection. Several health policy experts have criticized this concept on the grounds that it merely rearranges, rather than reduces, the burden, and that people with chronic illnesses could be especially hard-hit.
All this turns the question of Obamacare subsidies into a domestic political minefield between now and the next midterm elections. If the subsidies expire, the Democratic campaign is ready to boil the message down to a simple sentence: because of Republicans, health insurance premiums went up by 75 percent. If, on the other hand, some compromise is reached at the last minute, it will almost certainly contain provisions the progressive wing of the Democratic Party cannot support, guaranteeing internal tensions in the party. Because Republicans certainly will not extend the current system in a clean form, any compromise can only be some kind of false, cosmetic solution.
According to the current state of the American press, there is no visible guarantee that an agreement will be reached by January 1, so the affordability of premiums continues to keep millions enrolled in Obamacare, the health care system, and the political balance of power in the next election cycle in a state of uncertainty. It is a bad sign that people who have signed up for Obamacare are already receiving daily warnings that their plan will probably cost more even if they keep their current coverage. Most people are therefore trying to pay their January premium now, at the current price, hoping that they will only have to shoulder the increase starting in February.
Those hopes will be dashed if, from January 1, the government share changes, because the shortfall will have to be covered by the insured. The difference may even be collected retroactively.
