The average marketplace enrollee saved an estimated $700 in 2024 because of the enhanced premium tax credits. But, the enhancements expire at the end of 2025.
If they’re not extended, nearly everyone who buys coverage via the marketplaces will face significantly higher monthly payments.
Without an extension of the enhanced tax credits, the Congressional Budget Office estimates that the number of uninsured people will rise by 2.2 million in 2026. This number could increase by 3.7 million in 2027.
Either change — allowing enhanced premium tax credits to end and changing Medicaid funding and eligibility — would make it harder for individuals and families to afford coverage. In combination both would create vastly more financial hardship and keep coverage out of reach for more people.
People without coverage often skip necessary care, leading to worse health outcomes. For people in poor health, the results can be dangerous.
A distressed health care system
Expiration of the enhanced premium tax credits would result in a $6.3 billion increase in uncompensated care — that is, services that doctors and hospitals are not paid for — because of the increased number of people without insurance who cannot afford to pay out of pocket.
Some of the potential changes to Medicaid could increase uncompensated care by $19 billion.
Hospitals absorb most of these costs. Ultimately, this means fewer services, higher prices, and reduced investments in their local community.
This is especially dangerous at a time when many hospitals are facing the risk of closure.
Economic impacts
If Medicaid funding is cut and enhanced premium tax credits expire, there will also be harm to state and local economies as people lose coverage and the health care sector loses jobs.
Uninsured Americans have few resources to make ends meet when they have to pay out of pocket for urgent medical care for their families. This presents a financial challenge to the health care system. In turn, health care employers like hospitals would reduce jobs and spending, leading to broader projected job losses.
A new analysis shows that if the enhanced premium tax credits expire, state economies would lose $34 billion in gross domestic product and the country would experience 286,000 job losses nationwide. Nearly half of the jobs lost would be in hospitals, doctors’ offices, and pharmacies.
States that chose not to expand Medicaid would be hit the hardest if enhanced premium tax credits expire because there are no other affordable coverage options. For example, the 10 states that have not expanded Medicaid — Alabama, Florida, Georgia, Kansas, Mississippi, South Carolina, Tennessee, Texas, Wisconsin, and Wyoming — would lose 194,000 of the 286,000 total jobs.
Our commitment to affordable coverage for everyone
At Kaiser Permanente, we believe that everyone should have access to high-quality, affordable health care.
This can be achieved through a mix of public and private coverage.
As part of our commitment to the communities we serve, we care for 1.5 million people who are insured through Medicaid and over 800,000 who are enrolled in Kaiser Permanente coverage through the marketplaces.
To protect Americans, our health care system, and the economy, we urge Congress to extend the enhanced premium tax credits. We urge them to retain the current share of federal funding for Medicaid and continue coverage for adults with low incomes.
Policymakers should prioritize preserving what is successfully delivering for families as they seek budget savings to advance other preferences.