How will expiration of ACA premium tax credits affect premiums and coverage choices in 2026 for low- and middle-income families?
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Executive summary
If Congress does not extend the enhanced premium tax credits (ePTCs) that expire at the end of 2025, analysts and insurers project average Marketplace premium payments would more than double in 2026 — rising about 114% from $888 in 2025 to $1,904 in 2026 on average (KFF) — and millions could lose coverage (estimates range, with some analyses projecting roughly 3.8–4.8 million people) [1] [2]. Insurers’ rate filings and independent briefs also show smaller but measurable premium increases tied directly to the expected expiration, while modeling by policy groups highlights uneven, large burdens on low- and middle-income families, older enrollees, and those in high-premium states [3] [4] [5].
1. Immediate math: premiums jump and the subsidy cap tightens
KFF’s modeling projects a nationwide average net premium increase of 114% for Marketplace enrollees in 2026 if the ePTCs expire, moving average net payments from $888 to $1,904 [1]. That jump is driven by the return to pre‑enhancement “required contribution” rules and the loss of expanded eligibility above 400% of the federal poverty level (FPL), meaning many middle‑income families who got smaller or zero premiums will face much higher shares of income dedicated to premiums [6] [1].
2. Who bears the burden: lower incomes lose subsidized zero‑premium plans; middles see big hits
Policy briefs show the pain is concentrated among those at low to middle incomes. For example, people at 100–150% of FPL make up about 45% of Marketplace enrollees and many who paid $0 in 2025 could see nonzero premiums in 2026 — a family of four at 140% FPL could face about $1,607 more per year by one analysis [7]. At the same time, people above 400% FPL lose eligibility entirely, hitting older enrollees especially hard because unsubsidized premiums are much higher with age [5] [7].
3. Insurers’ filings: some premium increases already priced in
Rate filings in several states suggest insurers expect the ePTC expiration to raise premiums beyond general medical cost trends; KFF and the Peterson‑KFF tracker found filings in Vermont, Oregon, Washington, and D.C. that attribute roughly a 4 percentage‑point average increase to the expected expiration, and some companies explicitly included 4–5 points of their 12–13% requested hikes to reflect this policy change [4] [3]. Nationwide, insurers’ proposals and industry commentary point to larger baseline rate growth (median proposed increases around 18% in some analyses), which compounds the hit when combined with subsidy rollback [1] [7].
4. Coverage effects: models show millions at risk of becoming uninsured
Multiple institutions project substantial coverage losses if ePTCs lapse. The CBO and other estimates cited in reporting forecast increases in the uninsured population measured in the millions — the CBO estimated about 3.8 million more uninsured on average annually in 2026–2034 in an earlier letter, while Urban Institute work cited by Commonwealth Fund and others estimates as many as 4.8 million losing coverage in 2026 — with attendant increases in uncompensated care demand [2] [8]. Projections vary by methodology and assumptions about enrollment responses, but all analyses indicate a large increase in uninsured people.
5. Geographic and age disparities: older enrollees and high‑cost states suffer most
KFF’s mapping shows the largest dollar effects fall on older enrollees and residents of high‑premium states; a 60‑year‑old at 401% FPL could see annual premium payments more than double — in some states increasing by over $20,000 — reflecting both age rating and local premium levels [5]. These disparities mean two families with identical incomes can face very different outcomes depending on age and state market dynamics.
6. Secondary effects: economic ripple, insurer risk pools, and political friction
Analysts warn of spillovers: higher premiums could lead healthier people to drop coverage first, worsening risk pools and pressuring premiums further; state and health system budgets could face higher uncompensated care costs; one brief calculates potential macro impacts like job losses tied to lower household spending if subsidies lapse [9] [8] [2]. At the same time, some policymakers are debating short‑term extensions or targeted reforms, with bipartisan discussions noted in reporting but no final deal at the time of these sources [10].
7. What the sources agree on and where uncertainty remains
Sources uniformly agree ePTCs expire at end of 2025 and that expiration will raise net premiums and reduce affordability for many [11] [12] [1]. They differ in magnitude of coverage loss and in assumptions about insurer behavior and baseline premium inflation — insurer filings in a few states show modest added pressure (about +4 points) while national models incorporate larger price increases and behavior changes that produce higher projected premium and coverage impacts [4] [1] [7].
8. Practical takeaways for families and policymakers
Families should expect higher out‑of‑pocket premium bills in 2026 if Congress does nothing; lower‑income enrollees who benefited from zero or tiny premiums may no longer be shielded, and many middle‑income households will face steep increases [6] [1]. Policymakers face tradeoffs: extending ePTCs preserves coverage and household purchasing power but carries federal costs; letting them lapse reduces federal outlays while shifting costs to households, providers, and states — a redistribution that analyses warn will be large and uneven [2] [7] [10].
Limitations: available sources do not include any post‑November 2025 legislative outcomes or final 2026 enrollment data; projections vary by model and state assumptions and should be read as scenario estimates rather than precise predictions [1] [4].