ACA Subsidy Expiration Triggers Major Premium Hikes and Coverage Loss in Pennsylvania

Small business owners like Steve and Brenda Horst in Pennsylvania face significant financial strain as Affordable Care Act (ACA) health insurance premium subsidies are set to expire, causing premiums to spike sharply. Previously receiving subsidies that reduced their monthly premium to $1,600, the Horsts now face a $2,200 monthly premium for 2026 coverage, a 175% increase alongside higher deductibles. This increase represents more than a quarter of their pretax income, forcing consideration of going uninsured. Numerous ACA enrollees in Pennsylvania are similarly impacted, with Pennie—the state's ACA marketplace—reporting a 20% drop in new enrollments and a surge in coverage terminations since the subsidies' expiration took effect. Terminations are highest among middle-income households near the federal poverty level and older adults aged 55-64, while younger adults also contribute to coverage losses, destabilizing risk pools and driving premiums upward. Since 2021, enhanced premium tax credits provided about $600 million annually in Pennsylvania, capping insurance costs to no more than 8.5% of income; the loss of these supports is expected to trigger a 102% average premium increase. These changes exacerbate long-standing affordability challenges in the U.S. health insurance market, contributing to health-related financial stress for many. Industry observers highlight the critical regulatory role of Congress in addressing these subsidy extensions amid divided political impasses. The escalating costs highlight the potential for increased medical debt and insurance coverage gaps, factors closely tied to national bankruptcy statistics. The situation underscores the complex interplay of federal policy, state insurance markets, and consumer financial vulnerability amid ongoing healthcare affordability debates.