Almost 24 million people in the U.S. might experience a rise in their health insurance costs by over 75% in 2026.
This figure represents those enrolled in the Affordable Care Act (ACA) Marketplace program, as reported by the Kaiser Family Foundation (KFF).
Since 2021, many of these individuals have benefited from tax credits introduced during the pandemic that help lower their premium rates.
These credits have been crucial for freelancers, gig workers, and small business owners, making up nearly half of the program’s participants. Early retirees not yet on Medicare also gain from this.
“These credits facilitate access to insurance and allow workers to embark on new ventures without the anxiety of being uninsured,” noted Jonathan Gruber, an economics professor at MIT, in a conversation with Newsweek.
However, this situation is about to shift. The tax credits are set to expire at the end of 2025, and there’s been no indication from President Trump about extending them.
Gruber remarked that the discontinuation of these credits is already pushing health insurance costs upwards, with insurers planning to raise their premiums by over 18%. This hike will further inflate government health insurance costs.
In essence, the conclusion of the tax credit will impact everyone who relies on health coverage. Here’s a closer look at the implications:
Insurers anticipate that when subsidies end, some ACA Marketplace policyholders—particularly small business owners, self-employed individuals, and retirees not yet eligible for Medicare—might choose to drop their plans altogether.
Joseph Newhouse, a health policy professor at Harvard, explained that some may opt for cheaper, less comprehensive options instead.
As healthier individuals reduce or change their insurance plans, those remaining will face higher premiums, a trend that insurers are already predicting with their planned 18% premium increase.
Adding to the burden, the Consumer Financial Protection Bureau (CFPB) has recently guided that states cannot stop medical debt from appearing on credit reports, as reported by the National Consumer Law Center.
At present, state laws disallow such information on credit reports, but this guidance could influence court decisions, even though it is not legally binding.
Chi Chi Wu from the National Consumer Law Center described this move as particularly harsh with the tax credit expiration approaching, stressing that individuals will not only face increased medical expenses, but their credit scores might also take a hit.
“The CFPB under President Trump is compounding the harm, allowing medical debt to impact people’s credit history, complicating their ability to obtain credit, housing, and jobs,” he stated.
Worries about medical costs are widespread. A recent AP/National Opinion Research Center survey revealed that over half of the respondents expressed serious concern about healthcare expenses.
Here are some recommendations to brace for potential interest rate hikes in 2026.
Start comparing health plans early. During open enrollment, it may be beneficial to explore various shopping methods beyond just automatic renewal. The KFF Marketplace Calculator can give you a clearer picture of what you might pay, whether or not you qualify for subsidies.
Be mindful of your income limits. If your household income is nearing 400% of the federal poverty line, it’s essential to estimate your income accurately for the upcoming year, as even slight changes can alter your eligibility for assistance.
Prepare for possible rises in out-of-pocket expenses. It’s common for premiums to go up alongside deductibles, so consider setting aside a small emergency health fund now to mitigate financial stress later.
Stay informed. While lawmakers might take steps to extend the ACA tax credit, the ongoing political strife in Washington suggests that it’s wise to gear up for the potential expiration of these subsidies.
Without intervention from Congress, millions—especially freelancers and those nearing retirement—could find themselves facing a very challenging health insurance landscape in the coming decade.
The best approach is to remain updated and as ready as possible for the upcoming changes.
