Which states have laws or programs to extend ACA subsidies after 2026?
Executive summary
States and some jurisdictions have already used their own funds or exchange rules to blunt the 2026 cut in enhanced ACA premium tax credits: Vermont explicitly runs state-funded enhanced subsidies, and filings from Oregon, Washington state and the District of Columbia show state-level actions or planning to limit the hit for residents [1]. Most reporting and analyses, however, focus on federal action or the consequences of letting the enhanced credits expire; national estimates show average marketplace premium payments would rise sharply if enhanced credits lapse (114% in KFF’s national estimate) and CBO projects higher premiums and fiscal effects if Congress does not act [2] [3].
1. What state action exists now — who has already stepped in?
Available reporting explicitly identifies Vermont as a state that provides state-funded enhanced marketplace subsidies to reduce the 2026 impact for residents; the Peterson–KFF Health System Tracker lists Vermont alongside Oregon, Washington and Washington, D.C. as jurisdictions with recent insurer filings that “might lessen the impact” because of state-level choices, and it names Vermont specifically as having state-funded enhancements [1]. Insurer rate filings in those jurisdictions show regulators and insurers are already modeling scenarios that assume stronger local supports or different assumptions than the federal “sunset” baseline [1] [4].
2. How many states have programs like Vermont’s?
Available sources do not supply a complete, state-by-state inventory of which states have passed laws or budgets to extend the federal enhanced premium tax credits after 2025. The tracking pieces emphasize a small group of jurisdictions with clear, publicly reported actions (Vermont, Oregon, Washington and Washington, D.C.) but do not claim a comprehensive nationwide list [1].
3. Why some states act and what forms those actions take
States can blunt a federal subsidy lapse either by (a) allocating state funds to top up marketplace subsidies, (b) directing regulators to instruct insurers to file rates under the assumption that enhanced subsidies will continue, or (c) changing enrollment outreach and verification rules to reduce churn. The Health System Tracker and Peterson–KFF reporting describe insurers and regulators filing alternative rate scenarios and note Vermont’s explicit state-funded subsidies; Connecticut, by contrast, instructed insurers to file assuming enhanced federal credits continue—an administrative, not necessarily budgetary, step reflected in rate guidance [1] [4].
4. Who is driving national coverage — Congress vs. states?
Most analysts frame the core solution as federal: the enhanced premium tax credits created by ARPA/IRA are federal tax-law provisions set to expire at the end of 2025 unless Congress acts. National estimates from KFF and CBO — cited widely in the coverage — show steep national impacts if Congress allows the enhancements to lapse, including large average premium increases and projected uninsured increases; these analyses drive why many states are scrambling to model alternatives [2] [3] [5].
5. Scale and impact if states patch locally instead of federal extension
Policy trackers and insurer filings warn that even where states step in, local actions are unlikely to fully substitute for a federal extension because the federal enhanced credits are large and nationwide. KFF’s modeling and related reporting estimate a 114% average increase in premium payments if enhancements expire nationally; CBO projects higher gross benchmark premiums over coming years without a permanent extension. Those national numbers show why state-level fixes will be partial and uneven across the country [2] [3] [5].
6. Political and fiscal trade‑offs states face
State budgets vary. Adopting Vermont-style subsidies requires direct state appropriations and political will; instructing insurers to file on one assumption is administratively easier but does not create permanent relief if federal dollars vanish. Commentators and trackers stress the fiscal trade-offs: the CBO estimated a large federal cost for a permanent extension, while state-level top-ups would shift costs to state budgets — a hidden agenda point many state policymakers face as they weigh affordability for residents against local budget constraints [3] [6].
7. Bottom line and what’s not yet reported
The most-cited, concrete examples of post‑2025 state action in current reporting are Vermont’s state-funded enhanced subsidies and insurer/regulatory filings from Oregon, Washington and Washington, D.C. that reflect state-level responses; Connecticut’s regulatory direction to file assuming continuation is another administrative example [1] [4]. Available sources do not provide a full nationwide list of states that have passed laws or programs to extend enhanced federal credits past 2025, nor do they document uniform state approaches — coverage will be patchy unless Congress acts [1] [2] [3].