Enhancements to premium tax credits under the Affordable Care Act (ACA) — enacted through the American Rescue Plan and extended by the Inflation Reduction Act — are scheduled to expire at the end of 2025. These enhancements have helped more than 20 million people afford marketplace coverage and contributed to record-low uninsured rates.
With insurers finalizing 2026 premium rates and open enrollment starting November 1, many enrollees are already seeing higher costs. The Congressional Budget Office (CBO) estimates that if Congress delays action, 1.5 million more people could be uninsured in 2026. The average enrollee receiving premium tax credits (PTCs) may face an annual increase of more than $1,000.
What the Enhancements Did
The PTC enhancements lowered the share of income enrollees pay in premiums, provided $0 plans for people earning between 100% and 150% of the poverty level, and expanded eligibility to those earning above 400% of the poverty level if premiums exceeded 8.5% of income. Without them, premiums will more than double on average.
Enrollment and Income Effects
Since the enhancements began, ACA enrollment has more than doubled — from 11.2 million in 2021 to 23.4 million in 2025. People of color now make up 54% of marketplace enrollees, and enrollment among lower-income households (100–200% of the poverty level) rose by 143%.
According to the Joint Committee on Taxation, if extended, 94% of benefits would go to households earning under $200,000. Roughly 5 million self-employed workers and small business owners currently benefit from the ACA marketplaces.
Projected Premium Increases
If the enhancements expire:
- A single person earning $22,000 will see premiums rise from $0 to $66 per month.
- A family of four earning $66,000 will pay about $3,000 more per year.
- A 60-year-old couple earning $85,000 could see premiums jump from $7,225 to $31,846 annually.
States with higher base premiums, including West Virginia and Wyoming, will experience the steepest increases.
Coverage Outlook
If the enhancements are not renewed, CBO projects 3.8 million more people will be uninsured by 2035. The Urban Institute estimates a 30% rise in the uninsured rate among Black Americans in 2026. Overall, the number of people receiving premium tax credits would decline by 38%.
Unless extended, the ACA premium tax credit enhancements will expire after 2025, leading to significant premium hikes across all states and income levels. The changes could reduce marketplace enrollment and increase the number of uninsured individuals nationwide.
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