Individual market insurers requesting largest premium increases in more than 5 years, Peterson-KFF Health System Tracker, July 18, 2025, by Jared Ortaliza, et al.
… The costs of health care services like hospitalizations and physician care, as well as prescription drug costs tend to go up every year, and insurers often raise premiums to cover their increased costs. For 2026, insurers commonly say the underlying cost of health care (medical trend) is similar to last year’s reported 8%. …
Another change expected for next year is the enhanced [ACA] tax credits are set to expire. … For the last five years, enhanced premium tax credits have increased the amount of financial assistance enrollees in ACA Marketplace coverage receive, lowering their monthly premium payments. If Congress takes no action to renew these enhanced tax credits, enhanced subsidies will expire at the end of 2025, which will cause premium payments for subsidized enrollees to increase by over 75% starting in January 2026. Insurers expect a large share of enrollees to leave the market, and that those enrollees will be healthier on average, thus leaving the risk pool sicker on average.
Inflation Reduction Act Health Insurance Subsidies: What is Their Impact and What Would Happen if They Expire?, KFF, July 26, 2024, by Jared Ortaliza, et al.
Memo advises GOP to extend ACA tax credits, The Hill, July 22, 2025, by Alejandra O’Connell-Domenech, et al.
A new memo from Plymouth Union Public Research … advises Republicans that the best way to fend off attacks from the left about Medicaid cuts is to extend ObamaCare’s enhanced premium tax credits. …
The memo notes that all benefits [to taxpayers] from tax cuts will be nullified because of premium increases if the subsidies are not extended.
PUP Research is the sister group to PUP Advocacy, a conservative advocacy organization.
Extra subsidies that help people afford ObamaCare premiums that were put in place during the coronavirus pandemic are set to expire at the end of the year, and there are few signs Republicans are interested in tackling the issue at all.
If Congress takes no action, premiums for subsidized enrollees are projected to increase by more than 75 percent starting in January 2026, according to health research group KFF.
There is broad bipartisan and public support for extending the subsidies, and the memo cited recent polling from Trump pollster Fabrizio Ward that showed Republicans losing support in the most competitive districts if the tax credits expire.
But if Republicans extend them, the poll showed they can gain an advantage against Democrats in the midterms. The Republican candidate that supports extending the tax credits would lead the Democrat on the generic ballot by 6 points overall.
Comment:
By Jim Kahn, M.D., M.P.H.
The recently passed federal budget bill imposes massive cuts to Medicaid and Medicare, close to $1.5 trillion. The Medicaid cuts, mainly in eligibility criteria, start only after the Congressional mid-terms, shielding Republicans from voter backlash. The Medicare cuts arise from budget shortfalls caused by the massive tax cuts (tilted to the rich, of course).
Also happening through inaction is the expiration of COVID-era strengthening of ACA exchange plan subsidies (premium tax credits). As shown in the figure below, ACA enrollment rose sharply from 2020 to 2024, reaching 20 million subsidized individuals. The credits are set to expire in 2025. This will leave tens of millions of people in the lurch: experiencing a massive increase in costs – 75% higher premiums, about $1000, according to KFF analyses above. This will happen before the 2026 midterms, and be blamed on the GOP, likely exacting a significant toll at the ballot box
Republican strategists have noticed – as reported by The Hill, above. So of course they are encouraging a (short) extension of the subsidies. Which would place the Democrats in a political pickle – support the right policy, even if may hurt you in the next election.
No political party wants the hot potato of cutting insurance benefits, so they try to avoid credit (actually, blame). Wouldn’t it be spectacular if we were all covered, with the same cradle-to-grave universal health plan? Generous and efficient. Fairly funded. Single payer.
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