Expiration of ACA COVID Tax Credits to Drive Higher Premiums and Reduced Coverage in 2026

The expiration of COVID-era enhanced tax credits under the Affordable Care Act (ACA) is set to significantly increase health insurance costs for many Americans in 2026. These subsidies have helped millions afford monthly premiums over the past four years but their discontinuation means some will face soaring out-of-pocket expenses and reduced coverage options. For example, a retired couple in Wisconsin currently paying minimal premiums for a gold-tier plan will be forced to downgrade to a bronze plan with considerably higher deductibles and monthly fees, leading to financial strain and concerns about potential bankruptcy in the event of medical emergencies. Similarly, a family of four in Michigan relying on ACA coverage since 2014 finds their premiums jumping from $500 to $700 per month alongside higher deductibles and out-of-pocket costs, making insurance unaffordable given their $75,000 household income. They plan to forgo insurance coverage altogether in 2026, opting instead to pay cash for medical expenses, reflecting a difficult choice faced by middle-income families as assistance ends. In Nevada, a single mother with a tight budget for essential living and childcare expenses will see her premiums increase from $85 to nearly $750 monthly. She plans to pay the higher January cost but may drop coverage for herself if Congress does not extend subsidies. This case highlights the tight financial trade-offs families must consider amidst rising health care costs. The Senate recently rejected proposals to extend these enhanced subsidies, and current House Republican health care plans do not include such extensions. Unless legislative action occurs soon, numerous Americans enrolled in ACA plans will experience significant premium hikes and reduced access to comprehensive coverage, potentially shifting the insurance market dynamics and impacting health care affordability and access. This development underscores broader challenges in balancing health care affordability with evolving government policy and subsidy frameworks. Insurers, policy makers, and health care providers may need to anticipate shifts in enrollment patterns, coverage choices, and out-of-pocket spending for ACA enrollees in 2026. The potential increase in uninsured populations also raises concerns about broader public health implications and financial risk management for providers and payers.