US Senate Deadlock Leaves Colorado Health Insurance Subsidies at Risk for 2026

The U.S. Senate recently failed to pass legislation to extend enhanced premium tax credits, a subsidy program that currently helps approximately 225,000 Coloradans afford health insurance purchased individually. Two competing Senate proposals, one to extend the subsidies for three years backed by Democrats, and another proposed by Republicans focusing on government-funded health savings accounts, each fell short with 51 votes, missing the 60 needed for passage. Without this extension, the enhanced subsidies will expire at the end of the year, leading to significant increases in insurance premiums for many individuals in Colorado. The expiration impacts especially those buying insurance outside employer-sponsored plans, with estimates predicting an average increase of 101% in premiums for individuals on the state's exchange. This surge is expected to drive some 75,000 Coloradans to potentially drop coverage due to affordability concerns, although current enrollment has only dipped by about 5% year-over-year. The enhanced subsidies were initially introduced during the COVID-19 pandemic to supplement Affordable Care Act subsidies and counteract rising healthcare costs driven by inflation. Both Democratic Colorado senators, Michael Bennet and John Hickenlooper, voted against the Republican plan and supported the Democratic subsidy extension, emphasizing that the expiration could exacerbate healthcare affordability challenges and affect workforce stability, notably in small businesses. Senate Republicans criticized the Democrats' subsidy plan for lacking broader healthcare cost reforms, advocating instead for systemic changes alongside financial support. The subsidy expiration discussion also intersects with previous federal government funding battles, including a lengthy government shutdown rooted in disagreements over the subsidy extension. Despite the deadlock, discussions about potential healthcare reforms, including federally funded health savings accounts, continue to evolve. There remains a possibility for Congressional action to extend subsidies after the year's start, though political divisions pose challenges. Public opinion surveys reflect broad support across the political spectrum for extending subsidies, underscoring the issue's significance for individual and employer-based healthcare coverage decisions in Colorado and potentially nationwide.