ACA Federal Tax Credits Expiry Triggers Health Premium Surges Amid Government Shutdown

The Affordable Care Act (ACA) federal tax credits, which assist over 20 million Americans in affording health insurance, are set to expire by the end of 2025. These credits primarily benefit individuals who do not receive employer insurance and earn too much for Medicaid, including small business owners and retirees. If these credits lapse, affected individuals will face significantly higher insurance costs, paying full premiums out of pocket.

The expiration of ACA tax credits is a key issue in the ongoing government shutdown that began on October 1, 2025. Democrats insist on extending the tax credits to pass the funding bill, while Republicans want the government to reopen first and allow the credits to expire. Amid this uncertainty, insurers in New York are already notifying consumers of substantial premium increases for 2026, with counties like Clinton and Herkimer facing premium hikes exceeding 100%, and other counties seeing increases around 40%. These changes will lead to substantial financial impacts for insured families relying on the ACA marketplace.