Key takeaways

• The deadline to enroll in ACA plans for 2026 has passed without renewing ACA subsidies.
• Many people could see their health care costs double next year.
• ACA subsidies helped millions afford coverage through Medicaid expansion and marketplace plans.
• If subsidies end, 6–7 million people might leave the marketplace and 5 million could become uninsured.
• The debate over who pays for health care—government, employers, or individuals—remains unresolved.

Why ACA subsidies Are Fading in 2026

Congress missed the Dec. 15 deadline to extend ACA subsidies. As a result, the extra help added during the pandemic is set to end. Without action, many families will face much higher health care bills. Meanwhile, insurers are already planning rate hikes of about 18 percent on average for 2026. Together, this means double-digit increases for millions.

How ACA subsidies Changed Health Costs

Before 2021, ACA subsidies had limits. People earning up to 400 percent of the poverty line got help. Pandemic relief then widened those limits. It lowered or even eliminated premiums for many. It also let higher earners qualify. As a result, the number of subsidy recipients jumped from 9.2 million in 2020 to almost 22 million in 2025.

In addition, the share of the premium that people paid dropped. Low-income enrollees paid no premiums, and middle earners paid less. This change made health insurance far more affordable for workers without employer coverage.

Who Pays for Care Now?

Ever since the ACA passed in 2010, America has wrestled with who should fund health insurance. Some say the government should step in when people lose jobs or cannot afford private plans. Others argue that individuals and employers must cover the cost. This clash fuels political fights and policy shifts.

Originally, employers with over 50 staff had to offer insurance. Small businesses faced no such rule. Today, fewer mid-sized companies offer coverage. They lean on ACA marketplace plans instead. This trend worries critics, who say employers dodge their duty.

What Happens When ACA subsidies End?

If the pandemic-era ACA subsidies vanish in 2026, people will pay more out of pocket. For example, someone earning $45,000 a year will see monthly premiums jump by 74 percent. Their bill will rise by $153 each month, to about $360. Add the 18 percent rate increases, and costs could double.

Experts warn that 6 million to 7 million people may leave the marketplace due to higher prices. Up to 5 million of these might become uninsured. At the same time, recent Medicaid cuts could push over 7 million more off that program. Combined, nearly 12 million to 16 million could lose coverage by 2034, eroding ACA gains since 2010.

The Role of States

Medicaid expansion has helped lower the uninsured rate in many states. As of December 2025, 40 states and Washington, D.C., opted in. That move covered about 20 million people. Yet 10 states still resist expansion and maintain high uninsured rates.

State policies create big gaps. In Massachusetts, only 3 percent of under-65s lack coverage. In Texas, almost 19 percent do. Generally, Democratic-led states see lower uninsured rates. Republican-led states show higher numbers. This split mirrors the national debate over health care responsibility.

Competing Views on Coverage and Cost

On one side, advocates for government-led insurance argue that tax-funded plans ensure care for all. They see health as a right. They support higher public spending and stronger subsidies. They say this approach keeps people healthier and cuts long-term costs by boosting preventive care.

On the other side, market supporters believe competition drives better prices and innovation. They say individuals should shop for plans and employers should offer benefits. They worry that too much government aid reduces personal responsibility and spikes federal spending.

In a free-market model, insurers compete on price and services. This competition can lower rates, they argue. Still, critics say markets fail when people cannot afford even the lowest plans. They point to gaps in coverage and high medical debt.

What’s Next for Health Care Policy?

Without a clear answer to who pays for care, the debate will continue. Lawmakers must decide whether to extend ACA subsidies. They could pass a fix in early 2026, but time is tight. If they act quickly, subsidy levels could stay high and help millions avoid cost spikes.

Alternatively, Congress could redesign the subsidy formula. They might target only the lowest earners or spread benefits differently. Or they could push more states to expand Medicaid. Any move would reshape the health landscape and affect budgets.

Finally, the larger question remains unsolved: should the U.S. government bear most health care costs? Or should individuals and employers? Until that core issue is settled, policy will shift with each election.

FAQs

How many people rely on ACA subsidies?

Almost 22 million Americans received ACA subsidies in 2025 to help pay marketplace insurance. Without renewal, that number could fall by millions.

What happens if Congress does nothing?

If lawmakers fail to extend extra help, ACA subsidies will return to pre-pandemic levels. Many will face huge premium hikes, and millions could become uninsured.

Why do health care costs keep rising?

Costs rise due to higher medical prices, aging populations, and more complex care. Without strong subsidies or price controls, consumers pay more each year.

Can states ease the impact of subsidy cuts?

Yes. States can expand Medicaid, add their own subsidy funds, or control insurance costs. Pro-coverage states could shield more residents from premium spikes.