Unless Congress takes action as soon as possible, the key tax credits that help more than 22 million people buy Affordable Care Act (ACA) market plans will expire at the end of the year, causing premiums and cover losses.
The role of advanced tax credits
Since 2012, the ACA premium tax credit (PTC) has helped low- and middle-income people pay market premiums. In 2021, the U.S. Rescue Plan Act (ARPA) increased the number and availability of the Credit and Inflation Reduction Act (IRA) that delayed its expiration in 2022, but did not delay its expiration until the end of 2025. In particular, the July 2025 settlement bill continues with many other tax policies that these enhanced.
Although the July 2025 settlement bill continues many other tax policies this year, it excludes enhancements from the PTC.
PTC, including enhancements, is effective and widely used. They help nearly 93% of market participants provide insurance, reducing the average tuition fee from $619 to $113.
PTC enhancements improve access, affordability
The current enhancements of PTC and the PTC at risk have a significant impact. Thanks to these improvements, an estimated 7 million people will be able to afford this year's market plan, while reducing the number of uninsured people by 4 million. Overall, they helped market enrollment increase from 12 million in 2021 to 24.2 million in 2025.
Enhanced subsidies benefit particularly from low-income individuals.
As the Commonwealth Fund notes, enhanced subsidies benefit particularly from low-income populations, with enrollment rates in poor people with incomes below 250% increased from 8.2 million in 2021 to 15.9 million in 2024.
Similarly, City College predicts that they will help the lowest income groups see a 50% to 100% reduction in premiums this year, while those with higher income eligibility will see a 25% reduction. These forecasts match recorded successes: 80% of market participants can find plans for $10 per month or less in 2023 and 2024. In 2020, only 36% of PTC-compliant participants can find such a plan before increasing the tax credit.
Enhanced credits are essential for older people
A new AARP report explains how many older people who are not eligible for Medicare rely on market coverage and advanced tax credits, and enhanced subsidies are crucial to improving enrollment and coverage for this population. PTC has helped millions of adults aged 50 to 64 to buy coverage through the market, reducing the uninsured rate in this cohort by 50%.
PTC has helped millions of adults aged 50 to 64 through the market.
In 2024, nearly 5 million of the 5.2 million market participants aged 50 to 64 received PTC. Previous Avalere analysis estimated that points saved at least $600 a year, while some saved nearly $5,000. Increased affordability for this population is particularly important, as the ACA premiums for older people may be three times that for younger people.
What are the risks
If the enhancement expires at the end of the year, analysts agree that rising costs will put many people, including older people, out of their health insurance coverage. The KFF program's recruitment premium payments increased by more than 75% on average, while people in rural areas could increase by 90% while some participants could end up paying more than double.
Of the 5.5 million adults aged 50 to 64, the most AARP is expected to see higher premiums in 2026. Middle-aged middle-aged enrollees may see more than $4,000 in hikes, which may cause many to drop coverage and become insurance premiums for businesses.
Middle-income middle-aged enrollees may see more than $4,000 in hikes, which may cause many to give up coverage and have no insurance.
The Congressional Budget Office (CBO) has reached a similar conclusion, and it is estimated that ACA enrollment will drop from nearly 23 million in 2025 to 15 million in 2030 unless credits are extended. Other analyses are even more obvious. Actuaries at KFF Notes at Wakely warned that market enrollment fell by 50%, plus other changes to the ACA in the settlement bill.
Some people who have lost subsidized market plans may be able to find other insurance, while others (at least 4.2 million people, according to the CBO) will not have insurance. These losses in coverage mean not only less access to care and worse personal health, but also increases health insurance costs, as more people will join the program in poorer health conditions and require more expensive interventions than others.
Congress must act quickly
Under Medicare rights, we will continue to work to protect the coverage of ACA. People must get high-quality, affordable health care and insurance. Allowing enhanced PTC expiration will have the opposite effect. It will effectively increase taxes on low- and middle-income Americans, priced from health coverage by millions.
Medicare rights urge lawmakers to expand the enhanced PTC without delay.
To this end, we urge legislators to expand the enhanced PTC immediately. Although credits do not expire until the end of December, their availability must be guaranteed until admission is open on November 1. Otherwise, people may have no choice but to fall coverage this fall, facing high premiums in the face of the sky, which will undermine personal health and economic security and the sustainability of health insurance.
Read the AARP situation form, the Advanced Tax Credit protects the affordability of market health coverage for adults aged 50 to 64.
