Healthcare Premium Spikes Looming After Government Fails to Extend Tax Credits

For millions of Americans, open enrollment for health care coverage plans just got much more complicated and expensive.

The recent government shutdown ended last week with no extension of premium tax credits that are set to expire on December 31, 2025. As a result, experts at the Robert Wood Johnson Foundation are reporting that people looking to enroll in new plans are already seeing prices skyrocket.

An addition of the Affordable Care Act, the premium tax credits are broken down into four categories and help subsidize health insurance costs for lower income brackets. As recently as 2023, the number of Americans who were uninsured reached an all time low at 25.3 Million. Now, with the expiration of tax credits and rising prices for monthly plans, The Congressional Budget Office estimates that as many as 40% of currently covered Americans will drop medical coverage altogether.

Though Democrats in the House of Representatives demanded House Speaker Mike Johnson to hold another vote on extending the credits, Dr. Katherine Hempstead, Senior Policy Advisor at the Robert Wood Johnson Foundation encouraged people not to hold their breath that anything will change.

“ I think you could say that people at the low and high end of the income distribution in some ways are seeing the biggest effects,” said Hempstead. “ And if you are a very low income person, that might be something that you just can’t find the money to pay.”

The current open enrollment period for Affordable Care Act plans lasts until January 15, 2026, and Americans wishing to have their coverage start on January 1 will need to register by December 15, 2025. While the federal website to sign up for new plans is still open, Hempstead recommends New York State of Health for in-state coverage.

Still, she also argues that a universal healthcare or single payer system would be a worthwhile investment. Adopted by Canada, Japan, France, and many other countries, this system ensures that all citizens are covered by a national healthcare system.

“ I think you can find very few people who would say that the healthcare system is working well,” said Hempstead. “And those that you can find are usually in Medicare, which is a universal system. So that tells you something.”

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