ACA subsidies that lower monthly insurance premiums for millions of Americans set to expire

Insurance subsidies that have helped millions of Americans pay for health coverage are set to expire as 2025 ends on Wednesday.

The Affordable Care Act (ACA) subsidies, or premium tax credits, help lower or eliminate the out-of-pocket cost of monthly premiums for those who purchase coverage through the health insurance marketplace.

Eligibility for the subsidies can be determined by factors such as household income and geographic location.

The subsidies were part of the original ACA passed during the Obama administration and were enhanced during the COVID-19 pandemic to increase the amount of financial assistance to those who were already eligible and to expand eligibility to more people.

An estimated 22 million of the 24 million ACA marketplace enrollees are currently receiving enhanced premium tax credits to lower their monthly premiums, and many are preparing to see their premiums soar in 2026.

In October and November, the subsidies became a sticking point during the longest government shutdown in U.S. history.

Republicans said the expansions from the pandemic era went too far and tried to persuade Democrats to fund a temporary spending bill that didn’t address the expiring ACA subsidies, with promises of discussing ways to continue the subsidies later.

Meanwhile, Democrats insisted on extending the premium tax credits as part of a bill to end the shutdown, warning that their expiration could be detrimental for millions of American families.

However, in early November, the Senate reached a bipartisan deal to end the shutdown — that deal did not include any of the Democratic demands on health care. Eight Democrats voted with Republicans, and the bill was later also passed by the House.

Sources told ABC News that Republican leadership promised to allow a vote on a bill of Democrats’ choosing related to the ACA in December, but a pair of competing health care-related bills failed to advance in the Senate earlier this month.

“The ACA tax credits expire at midnight,” House Minority Whip Katherine Clark (D-Mass.) wrote in a post on X Wednesday morning. “Millions will see their premiums skyrocket because Republicans refused to act. You deserve better, and Democrats will keep fighting to lower costs.”

In January, the House is expected to vote on a Democrat-led bill that would see the enhanced premium tax credits extended by three years.

Estimates from the Congressional Budget Office have suggested that, without an extension, gross benchmark premiums — the price of a standard plan before government subsidies are applied — could increase by 4.3% in 2026 and by 7.7% in 2027 for those on marketplace plans.

A KFF analysis last month found that people who buy insurance from the marketplace, and receive financial assistance, would see their premiums rise by about 114% on average, from $888 in 2025 to $1,904 in 2026.

Doug Butchart, from Illinois, told ABC News he doesn’t know how he’s going to pay for monthly insurance premiums for his wife, Shadene, who has the neurological disorder amyotrophic lateral sclerosis (ALS).

Butchart noted that his wife’s monthly premiums will climb to more than $2,000, which they “can’t afford.” They’ve switched to a cheaper plan, but it will still be a struggle to cover costs, he said.

“We’re going to have to figure it out,” he said. “We do have money saved, but it’s supposed to last a lot longer than a year or two. … We have the end of the year coming and no real solution to a problem.”

ABC News’ Selina Wang contributed to this report.