Most Americans who rely on health insurance through the Affordable Care Act—known as Obamacare—will begin enrolling for 2026 coverage on Saturday. But next year’s premiums could be significantly higher for millions of households.
Premium tax credits added during the pandemic have been at the center of the ongoing government shutdown, and are a main driving force behind expected price hikes come next year.
More than 24 million people are currently covered under the ACA, enacted 15 years ago to expand access to affordable healthcare. Analysts warn that average premiums could rise by as much as 26%, with some families facing steeper increases as federal subsidies expire and marketplace premiums rise.
Here’s what to know about what’s driving the potential hikes.
What is the Affordable Care Act?
The Affordable Care Act, introduced in March 2010 under the Obama Administration, provides subsidized health insurance for Americans earning between 100% and 400% of the federal poverty level. Those subsidies—known as premium tax credits—are designed to reduce the cost of monthly premiums for low- and middle-income households.
The poverty threshold varies by family size, from $15,650 for an individual to $54,150 for a family of eight in 2025. Families earning less than 138% of the poverty level are also eligible for expanded Medicaid coverage, although 10 states, including Texas, Florida, and Georgia, have not adopted the expansion.
What is causing the rise in health insurance costs under ACA?
Several factors are expected to drive up ACA premiums in 2026, but the biggest is the expiration of enhanced premium tax credits at the end of 2025.
Those subsidies—expanded during the pandemic and later extended by Congress—have lowered costs for millions of enrollees. But with negotiations over the ongoing government shutdown stalled, lawmakers have yet to agree on a renewal. Democrats say Republicans’ refusal to extend the credits will lead to steep increases for working families, while Republicans argue that the program fuels waste and fraud.
“Healthcare premiums are about to skyrocket. But Republicans have spent their entire shutdown with their heads in the sand,” said Democrat leader in the Senate Chuck Schumer on Thursday.
Without congressional action, premiums could more than double, increasing by an average of 114%, according to the Kaiser Family Foundation (KFF). The group estimates that 22 million of the 24 million Americans currently enrolled in ACA plans would be affected.
Read More: Rising Health Care Costs Are the Real Reason for the Government Shutdown
Who will be hit the hardest?
If the subsidies lapse, middle-income families who no longer qualify for tax credits will face the steepest cost increases.
KFF projections show that a family in Virginia could see deductibles rise from $800 to $20,000 next year. In Idaho, some households may pay an additional $100 per month, while a Maryland family could face $500 more per month in premiums.
For lawful immigrants, premium subsidies will also end in 2026. Legal residents who are ineligible for Medicaid because of their immigration status and whose incomes fall below 100% of the poverty level will no longer receive ACA tax credits.
Republicans say current ACA provisions are overly generous. House Speaker Mike Johnson has argued that maintaining them amounts to offering “free healthcare for illegal immigrants.”
Vice President J.D. Vance has likewise claimed the tax credits have fueled waste and fraud. “The tax credits go to some people deservedly, and we think the tax credits actually go to a lot of waste and fraud within the insurance industry. So we want to make sure that the tax credits go to the people who need them,” Vance told CBS in an interview on October 12.
The One Big Beautiful Bill Act, introduced by President Donald Trump and enacted in July this year, has also made significant changes to those eligible for ACA, making it much more difficult for some people to enroll. Under the changes to the Act, which are set to remain in place until 2034, KFF estimates that up to 1.7 million Americans will no longer be eligible to receive such coverage by 2034.
How is the Trump Administration changing the ACA?
President Donald Trump’s One Big Beautiful Bill Act, enacted in July, includes provisions that will reshape eligibility for ACA subsidies over the next decade. The Administration says the reforms are intended to reduce costs and eliminate abuse, but KFF estimates that as many as 1.7 million Americans could lose ACA coverage by 2034 under the new rules.
When can Americans enroll?
Enrolment for ACA in most states opens on Nov. 1. People have until Dec. 15 to enroll in or change plans for coverage to start on Jan. 1. Meanwhile, Jan. 15 is the last day to enroll in or change marketplace health plans for the year. After that date, people can enroll in or change plans “only if they qualify for a Special Enrollment Period.”
You can check the enrollment timeline for your state, and find out further information, on the healthcare.gov website.
