Congress has less time than lawmakers may think to renew enhanced subsidies for health insurance exchange customers before the market is disrupted, state officials are warning federal policymakers.
Executives from 20 state-based marketplaces including Covered California, Connect for Health Colorado and the Massachusetts Health Connector traveled to Washington to exhort Congress to extend the more generous tax credits that drove exchange enrollment to record highs before they expire at the end of the year.
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“This is not some 'inside-the-beltway' budget exercise or a political football,” Audrey Gasteier, executive director of the Massachusetts Health Connector, said during a news conference Tuesday. “This is real people's lives. This is people's financial stability. This is people's access to healthcare that keeps them and their families safe and well.”
The looming end of these subsidies complicates planning for the exchanges and the health insurance sector, which need to anticipate what the customer base will look like next year and calculate premiums. And this market already faces headwinds from President Donald Trump's administration, which has taken steps to shorten the open enrollment period and slash enrollment assistance funding.
Health insurance exchange officials met with lawmakers and officials at the Centers for Medicare and Medicaid Services on Monday and Tuesday to press their case, they said.
Health insurers are readying rate change requests for 2026, which have to be finalized this summer to give companies time to notify customers and plan market strategies before open enrollment, said Jessica Altman, executive director of Covered California. The sign-up period begins Nov. 1 in most states.
That means insurers and states may have to game out two scenarios: one with the enhanced subsidies and another with the tax credits as originally written in the ACA, Altman said.
A definitive answer to whether Trump and the GOP-led Congress will let the beefed up tax credits lapse would at least resolve those logistical issues. But the exchange executives were clear that their preference is to reauthorize them.
“We could be looking at an open enrollment where people see record drops in the affordability of the coverage,” Gasteier said.
Though Republicans have long sought to eliminate the Affordable Care Act of 2010, they may be reluctant to let the subsidies expire because of the consequences for their constituents. Yet the issue has not been part of the fraught intraparty discussions about a sweeping tax-and-spending-cuts package the GOP is assembling, which is likely to feature significant Medicaid cuts.
If Congress chooses not to extend the subsidies, premiums will rise, the risk pool will worsen and enrollment will fall, said Kevin Patterson, executive director of Connect for Health Colorado. Younger, healthier customers and rural residents are most likely to flee the exchanges in large numbers under those circumstances, he said.
In Colorado, premiums could jump as much as 76% in rural areas and 50% in urban areas if the subsidies aren't renewed, Patterson said.
Uncertainty about financial assistance in the meantime may depress enrollment, Altman said. “From our experience, people leave for sticker shock. And even if the tax credits do get extended, if they get that letter, they may not come back,” she said.
