At the 11th hour, an Affordable Care Act subsidy accord remains elusive (updated Dec. 11)

Dec. 11 update

As expected, the Senate did not have the votes Thursday to pass either Democratic or Republican proposals for providing financial assistance to Affordable Care Act (ACA) marketplace enrollees.

With Congress scheduled to be on recess for two weeks beginning Dec. 22, the stalemate makes large increases in out-of-pocket premiums a more likely scenario for millions who had a marketplace plan in 2025 and are considering whether to reenroll in 2026.

A Democratic plan for a three-year extension of the enhanced subsidies for buying ACA insurance attained a 51-member majority in Thursday’s vote, with four Republicans voting in favor. But that was not enough to clear the 60-vote threshold needed to advance legislation in the upper chamber.

Similarly, a Republican plan to replace the enhanced subsidies with a system of health savings accounts (see the Dec. 9 update below) gained 51 votes, with all but one Republican in favor.

Although the parties have not closed the door on trying to reach a compromise, Sen. Chuck Schumer (D-N.Y.), the chamber’s minority leader, said the Democrats’ bill was “the last train to leave the station” as an opportunity to act before the end of the year.

What comes next

Later windows to pass a bill could arrive in January, including as part of a budget deal to keep the government fully functioning past the scheduled Jan. 30 expiration of federal funding. With Dec. 15 bringing the deadline for enrollees to have marketplace coverage for Jan. 1, and with Jan. 15 marking the end of 2026 open enrollment, a late-January timetable likely would require implementing a special enrollment period.

A difficult aspect of any such deal would be how to address premiums for enrollees who already have purchased a plan for 2026. According to CMS, 5.75 million people enrolled in an ACA plan in November (see the Dec. 8 update below). That was higher than at the same point in the open-enrollment period for 2025, when a record 24.3 million people ultimately signed up, including more than 22 million who qualified for subsidies.

The closest thing to a bipartisan effort on the matter is a House bill (see the original story below) that includes an extension of the subsidies, with additional eligibility restrictions, and sets up the opportunity to incorporate health savings accounts and other policies preferred by Republicans, although a second vote would be required to implement them.

House GOP leaders have not committed to providing the support needed to bring that bill to the floor and instead have indicated a preference for the chamber to vote on legislation more closely aligned with the Republican bill that was considered Thursday in the Senate.

The stakes

In a scenario where the enhanced subsidies expire, KFF has calculated that enrollees would experience a 114% increase in what they pay in premiums, albeit with wide disparities based on factors such as age and geography.

The Congressional Budget Office has projected an increase of 2.2 million in the uninsured ranks for 2026. The left-of-center Urban Institute estimates a significantly bigger increase, 4.8 million.

The ACA would retain the subsidies that were originally part of the 2010 law. Key changes if the enhanced subsidies are terminated include reinstatement of an eligibility cap at 400% of federal poverty, whereas the enhanced subsidies do not have a cap and instead ensure premiums will not cost higher-income enrollees more than 8.5% of their income.

Among the other differences is that without the enhanced subsidies, there are no zero-premium subsidized plans for people earning between 100% and 150% of federal poverty. In 2026, reverting to the baseline subsidies would mean households at the low end of that range owe 2.1% of their income to cover the premium for their ACA plan.

Dec. 9 update

Republican leadership in the Senate unveiled legislation to implement a system of health savings accounts (HSAs) for Affordable Care Act enrollees, replacing the expiring subsidies for buying ACA marketplace insurance. The plan is to vote on the bill in conjunction with a Dec. 11 vote on Democratic legislation to extend the enhanced subsidies for three years.

Neither bill is expected to clear the 60-vote threshold needed to pass legislation under normal Senate rules, although Sen. Bill Cassidy (R-La.), who is spearheading the GOP’s bill, has said he could consider a compromise that includes a subsidy extension.

House members have drafted bipartisan legislation (see below), but it remains to be seen whether that effort even receives a vote.

The Cassidy bill would deposit payments into HSAs for enrollees with low-premium, high-deductible Bronze or catastrophic plans in 2026 and 2027. Eligibility would be limited to those with household incomes under 700% of federal poverty.

Yearly funding would total $1,500 per enrollee ages 50 to 64 and $1,000 for those ages 18 to 49. Out-of-pocket maximums for Bronze plans can be set as high as $10,500 in 2026. The projected gap led Sen. Chuck Schumer (D-N.Y.), the Senate minority leader, to say the proposal amounts to “junk insurance” in remarks Tuesday.

HSA funds would be prohibited from being applied to abortion or gender transition services.

Starting in 2027, the bill would allocate funding for cost-sharing reduction (CSR) payments for low-income enrollees. Insurers have been obligated to provide CSR payments, which go to defray out-of-pocket costs for Silver plan members, since the ACA’s initial implementation but since 2017 have not received federal assistance. That gap has led to significant increases in baseline Silver plan premiums as a way for insurers to make up the cost.

Dec. 8 update

Thus far, the uncertainty surrounding Affordable Care Act (ACA) marketplace coverage for 2026 (as described below) does not appear to have had an adverse impact on year-over-year enrollment.

New data from CMS shows that 5.75 million people had enrolled in a marketplace plan by the end of November. That includes 4.8 million returning customers and nearly 950,000 who did not have a 2025 marketplace plan. Open enrollment for 2026 began Nov. 1.

At a comparable point in 2024, 5.3 million people had enrolled in coverage for the 2025 plan year. A moderately higher number of new enrollees, 988,000, had signed up. Total enrollment for 2025 finished at a record 24.3 million.

A year-over-year drop-off still could be seen later in the process as people who are on the fence about enrolling amid higher premiums make their decisions. Open enrollment is available through Jan. 15.

The above numbers for each year do not include auto renewals. Marketplace enrollees are reenrolled in their current plan by default to ensure they do not accidentally drop their coverage. They can change or terminate their coverage during open enrollment.

Auto renewals are considered part of the final enrollment tally only after the enrollee makes an initial premium payment.

Original story

With the expiration date for the Affordable Care Act (ACA) enhanced subsidies rapidly approaching, Democrats and Republicans in Congress are not on the verge of a deal.

The sides are sticking to their entrenched positions, especially in the Senate, with Democrats encouraging an extension of the subsidies and Republicans saying an alternative approach is needed to help people afford coverage.

The situation is not expected to be resolved during a Senate floor vote tentatively scheduled for Dec. 11. Sen. John Thune (R-S.D.), the chamber’s majority leader, agreed to hold a vote in return for the votes of eight Democrats to reopen the government after a record 43-day shutdown.

Democrats intend to push for a vote on a three-year extension of the subsidies, Sen. Chuck Schumer (D-N.Y.), the Senate minority leader, said Thursday on Capitol Hill.

“Our bill is the last chance Republicans will get before Jan. 1 to prevent premiums from skyrocketing,” Schumer told reporters.

Thune said Republicans have not decided whether to put forth a competing bill in conjunction with the vote.

ACA enrollees in limbo

Uncertainty thus lingers over the ACA marketplaces one year after a record 24.3 million people enrolled in marketplace plans, including roughly 22 million whose premiums were reduced or negated via the enhanced subsidies.

The deadline to enroll is Dec. 15 for coverage to take effect Jan. 1. The open-enrollment period runs through Jan. 15.

In survey results released Thursday, KFF reported that 25% of enrollees “very likely” would go without insurance if their premiums doubled. The organization previously has projected that out-of-pocket premiums would rise by 114%, on average, if the subsidies expire. The average subsidized enrollee would be looking at an increase from less than $900 per year to more than $1,900.

In addition, a third of respondents said they most likely would look for an option with lower premiums, thus leaving them on the hook for higher deductibles and copays when receiving healthcare.

Searching for a solution

Per reports, President Donald Trump in November was prepared to offer a subsidy deal with provisions tailored to both parties. But the White House backed off amid resistance from congressional conservatives who are opposed to extending the subsidies at anywhere near the projected cost.

The same opposition may present an obstacle to making further progress with a bipartisan push that has emerged the in House. Dating back to the 1990s, Republican leadership in the lower chamber typically adheres to a policy of bringing bills to the floor only when there is a majority in favor within the GOP caucus.

More than 30 House Democrats and Republicans released a plan Thursday to extend the subsidies for one year while also prolonging open enrollment through March 19 and incorporating an income cap. Provisions also would be added to tackle fraud in the marketplaces.

Note: The above paragraph has been corrected to reflect that the proposal would extend the subsidies for one year rather than two years.

The second year of the two-year deal, 2027, would bring the possibility of additional changes if agreed to next year in a separate congressional vote. One item for consideration in that subsequent vote would eliminate zero-dollar premiums as an option for low-income enrollees, albeit subject to a hardship exemption. Republicans generally support requiring a minimum premium payment, saying the lack of any such obligation allows people to be enrolled without their knowledge by insurance brokers.

This week, Republican leaders in the House said they found support for that criticism in a Government Accountability Office (GAO) report for which the GAO submitted applications for 24 fake enrollees across 2024 and 2025. When the report was issued, 22 of the applicants remained actively covered at a total cost of more than $12,000.

Finding alternative means of financial support

Another year-two provision in the House plan potentially would implement a proposal by Sen. Bill Cassidy (R-La.), chair of the Health, Education, Labor and Pensions (HELP) Committee, to turn the funding for enhanced subsidies into contributions to health savings accounts (HSAs) for people with Bronze marketplace plans.

Cassidy maintains the infrastructure is in place to implement the plan for the start of 2026, in part because the 2025 bill known as the One Big Beautiful Bill Act (OBBBA) established HSAs as an option for Bronze plan enrollees. Healthcare.gov and the state-run marketplaces should not need to overhaul their systems to make the accounts widely available.

“We’ve got to have a solution two or three weeks from now,” Cassidy said Wednesday during a HELP Committee hearing.

Most features of ACA health plans would carry over under the proposal, with the main difference being the requirement for more enrollees to cover a larger share of their premiums as priced for Bronze plans. They could apply their HSA balance to their out-of-pocket costs.

In the aftermath of the government shutdown, Cassidy spoke of implementing flexible spending accounts (FSAs). More recently he has referenced HSAs. Both accounts allow health plan enrollees to deposit funds that can be used to cover deductibles and copays, but among the differences is that HSA funds can roll over from one year to the next.

Stumbling blocks to the HSA proposal

Not all Republicans are as confident about the practicality of Cassidy’s plan in the immediate term.

“We have no choice but to modify and extend these tax credits [the subsidies] to get us some time to find a permanent solution to this pressing problem,” Sen. Lisa Murkowski (R-Alaska) said during the HELP Committee hearing.

The narrow window for implementing changes also is a leading concern of Democrats who have voiced opposition to the plan.

“Realistically, the only way we can still stop people from seeing these huge [premium] increases is a clean extension and a longer open enrollment,” Sen. Patty Murray (D-Wash.) said during the hearing. “Forget about time spent negotiating [a plan]. Even if we passed a bill today, there is not time to implement anything more complicated than a clean extension.”

She added, “We can talk about reforms ahead of the 2027 year.”

Beyond the logistical challenges, some Democrats have expressed qualms that Cassidy’s plan will leave ACA plan enrollees vulnerable to high healthcare costs. If an enrollee’s HSA funding is equal to what their subsidy would have been, it could fall short of out-of-pocket costs that are capped at $10,600 for individuals and $21,200 for families enrolled in 2026 Bronze plans.

“Some of what is being proposed might leave patients to fend for themselves in an already-complicated and overpriced healthcare system,” said Sen. Lisa Blunt Rochester (D-Del.).

Cassidy said Democrats have had productive talks with him about his proposal.

“We’ve got two choices,” he said. “[Either] we accept the premise that no deal is possible, the [enhanced subsidies] go away, no reforms are made to a failing system, and we have a failed floor vote. Alternatively, we roll up our sleeves and seek out a true middle ground.”