Obamacare is the popular name for the Affordable Care Act (ACA), enacted in 2010 by President Barack Obama.
Currently, the number of people benefiting from or insured through Obamacare (including enrollments through the Health Insurance Marketplace, the Medicaid expansion, and other ACA provisions) is estimated at nearly 50 million Americans.
But as a result of the provisions of the “big, beautiful” fiscal package, these subsidies, approved in 2021 and extended in 2022, were eliminated. This sparked the fight between Democrats and Republicans that led to the government shutdown.
Democrats conditioned their vote to reopen the government on the restoration of the subsidies. The White House and Republicans are only willing to discuss the issue with the government open.
An excellent analysis by The New York Times, using data from the Kaiser Family Foundation (KFF), shows “considerable increases” in monthly premiums across most of the country.
If Congress allows these subsidies to expire at the end of this year, premiums will rise significantly, in some cases by more than $1,000 per month, according to the analysis.
Currently, people with lower incomes—less than $24,000 a year—pay no monthly premiums thanks to the expanded subsidies. But if they expire, they will lose access to free insurance. A 27, 40, or 60-year-old would pay $66 a month, instead of $0.
“While the increase may seem modest, it represents a significant blow to those earning less than $2,000 a month. Since the enhanced subsidies were implemented, enrollment in this low-income group has tripled, with sharp increases in Texas, Florida, and Georgia,” according to the analysis.
A worker earning $35,000 will see their premium more than double, jumping from $86 to $218 per month for a typical plan. About 40% of those enrolled in the ACA marketplace fall into this income bracket.
For those earning around $65,000, the impact will depend on their age and where they live. A 27-year-old will pay $540 per month (an increase of $80). At age 40, the cost rises to $656 (an increase of $196). At age 60, it skyrockets to $1,380, an increase of $920.
The NYT and KFF analysis indicates that older adults will be particularly affected, as insurers can charge them more than younger people. In rural areas or states with small markets, such as Wyoming or West Virginia, premiums are even higher. In southern Illinois, for example, a 60-year-old could see their monthly payments jump from $460 to $2,800.
Those earning around $95,000 and under 40 won’t see significant changes, as the benefits are minimal for them. However, those over 60 will lose support: their premiums will rise from $673 to $1,387, an increase of $714 per month.
“Less than 10% of Obamacare enrollees earn more than $65,000 a year, but for them, the increases could be the most pronounced. In contrast, most low-income beneficiaries will see smaller increases in dollar terms, though significant relative to their income,” he noted.
Enrollment in the marketplaces began on November 1st, and Congress is still debating whether or not to extend the benefits.
KFF offers an online tool to estimate the increases in specific cases at kff.org/interactive/calculator-aca-enhanced-premium-tax-credit/.
