Impending Shutdown End: Will Millions Lose Health Insurance?

The recent bipartisan agreement in the Senate has closed the longest government shutdown in U.S. history, providing temporary relief and reopening the government until January 30, 2024. However, millions of Americans are now faced with pressing concerns regarding their health insurance under the Affordable Care Act (ACA). This article explores the potential impact of the deal on ACA enrollees and their coverage costs.

Impending Shutdown End: Will Millions Lose Health Insurance?

The agreement reached last week has garnered attention, but it leaves crucial decisions about ACA affordability unresolved. Congress is expected to address the extension of COVID-19 tax credits in December. These credits play a vital role in making ACA health insurance plans more affordable for eligible Americans.

The Aftermath of Expiring Pandemic Subsidies

• KFF estimates that approximately 22 million Americans currently receiving ACA tax credits may see their monthly premiums more than double by 2026.
• The average increase in out-of-pocket costs will reach approximately $1,016 per enrollee.
• Over four million Americans are likely to drop their ACA coverage if the pandemic-era subsidies are not renewed.

While those earning below four times the federal poverty level will still qualify for original subsidies under the ACA, many will experience increased financial burdens due to the loss of enhanced support introduced during the pandemic.

Impact on ACA Premiums and Coverage

With pandemic subsidies coming to an end, health insurance companies are expected to raise rates dramatically. An analysis by KFF indicates that premiums for plans offered in 2026 could see an average increase of 26%. This reflects rising medical costs and the frequency of medical care among consumers.

Individuals making over $62,600, or families earning above $128,600, will be particularly affected, as they will need to cover the full cost of their plans. Alternatively, enrollees may have to consider switching to less expensive plans with higher deductibles.

Who Will Be Affected?

The expiration of pandemic-era tax credits will severely impact various groups:

• Small business owners without employer-provided insurance may struggle with higher costs.
• Farmers and gig economy workers who lack workplace coverage are also at risk of increased insurance bills.
• The possibility of higher premiums in 2027 is looming, as insurers could face a sicker risk pool.

Experts warn that neglecting to extend pandemic subsidies could lead to a significant loss of healthier enrollees in the ACA marketplace, causing a ripple effect on the stability of health insurance premiums in future years.

As the December deadline approaches, the focus remains on whether Congress will take action to extend these essential tax credits. The decisions made in the coming months will have lasting effects on millions of Americans relying on the Affordable Care Act for their health insurance needs.