ACA marketplace open enrollment begins as enhanced premium tax credits set to expire

The 2026 Affordable Care Act open enrollment begins on November 1, 2025, amid a federal government shutdown triggered by a congressional standoff over expiring enhanced premium tax credits. If Congress fails to extend these subsidies, out-of-pocket premiums for the 24 million marketplace enrollees are projected to rise by an average of 114%, on top of a 26% average increase in base insurer rates. The Congressional Budget Office warns that letting the credits lapse will leave 4 million more Americans uninsured, while industry leaders like Cigna's Dr. Amy Flaster caution that the resulting unreimbursed care will drive up commercial and employer-sponsored premiums.

Enhanced premium tax credits expiration

• ▪The enhanced premium tax credits removed the original Affordable Care Act income cap, allowing middle-income enrollees earning above 400% of the federal poverty level to qualify for financial assistance.
• ▪The Affordable Care Act Marketplace enhanced premium tax credits, which were introduced in 2021 to provide extra financial assistance to subsidized enrollees, are scheduled to expire at the end of 2025.
• ▪The Congressional Budget Office estimates that extending the enhanced premium tax credits would add approximately $350 billion to federal spending over a ten-year period.

ACA marketplace premium increases

• ▪Affordable Care Act Marketplace premiums are set to increase by an average of 26% in 2026, representing one of the largest premium jumps since the program debuted.
• ▪Insurers have cited rising drug prices, high hospital costs, overall medical inflation, and the anticipated departure of healthy enrollees as primary drivers for the 2026 premium increases.
• ▪The monthly premium for the benchmark plan on the federal exchange, HealthCare.gov, is projected to rise by an average of 30% in 2026, while premiums on state-run exchanges will rise by an average of 17%.

Enrollee out-of-pocket cost impacts

• ▪In New Jersey, the expiration of the enhanced subsidies combined with a 16.6% insurer rate hike will cause average annual premiums to rise by over 174% to more than $2,780 in 2026.
• ▪Without the enhanced subsidies, a 64-year-old enrollee with an income at 401% of the federal poverty level will see their average annual premium rise from $5,328 in 2025 to $16,500 in 2026.
• ▪If the enhanced premium tax credits expire, subsidized Affordable Care Act Marketplace enrollees will see their out-of-pocket monthly premium payments increase by an average of 114% in 2026.

Government shutdown over subsidies

• ▪Congressional Democrats refuse to support any federal funding bill that excludes an extension of the tax credits, while Republicans refuse to negotiate on the subsidies until the government reopens.
• ▪The political standoff over extending the enhanced premium tax credits is a primary cause of the federal government shutdown that began on October 1, 2025.

Coverage loss risks

• ▪The Congressional Budget Office estimates that approximately 4 million Americans will lose health insurance coverage if the enhanced premium tax credits are allowed to lapse.
• ▪In Colorado, the state's Division of Insurance announced that roughly 75,000 residents will lose access to health coverage if the enhanced subsidies expire.

Market stability concerns

• ▪Insurers expect younger, healthier enrollees to drop their Marketplace plans if subsidies expire, which would leave a sicker risk pool and drive future premium rates even higher.
• ▪Cigna Healthcare Chief Medical Officer Dr. Amy Flaster stated that the expiration of the tax credits could cause commercial and employer-sponsored premiums to rise to offset unreimbursed care at provider systems.

Debatable claims

• ▪Eliminating repayment limits for excess ACA subsidies is necessary to protect taxpayers
• ▪Congress should extend the enhanced Affordable Care Act premium tax credits