Millions of Americans are preparing for a steep increase in healthcare insurance costs as the open enrollment period for Affordable Care Act (ACA) marketplace plans begins. Approximately 24 million people get their health insurance through the marketplace, most of whom have benefited from enhanced premium tax credits designed to lower monthly premiums.
These subsidies, originally expanded during the pandemic, are scheduled to expire at the end of 2025. Without these credits, average monthly insurance costs are projected to rise by 114%, which could mean an additional $1,000 annually for many families, with some facing even higher increases.
This looming spike has become a focal point in the ongoing political debate surrounding the federal government shutdown. Democratic lawmakers are demanding an extension of these subsidies as a condition for reopening the government, emphasizing the financial relief these credits provide millions of Americans. Meanwhile, Republicans argue that subsidy discussions should not proceed until a clean government funding bill passes.
The expiration of these enhanced subsidies threatens to increase the uninsured rate and place significant financial pressure on households, particularly those absent traditional employer-sponsored health coverage. While even if subsidies are extended, insurance premiums are expected to rise substantially in 2026 due to market dynamics and insurer behavior.
