Analysts suggest that not renewing health insurance subsidies tied to the Affordable Care Act could hit Republican states hardest, especially those in the South.
This topic is pivotal in the ongoing federal government shutdown, with Democrats advocating for an extension of these subsidies while Republicans favor letting them expire by year’s end.
Currently, the online marketplace for the ACA offers plans without subsidies. Premiums, on average, have more than doubled since this month, when insurance openings began for 2026. This spike is largely due to the end of ACA subsidies and rising interest rates from insurers, as reported by KFF, a nonpartisan health policy research organization.
In an op-ed from October 23, Matthew Martin, a senior U.S. economist at Oxford Economics, highlighted that more than half of the 24 million enrollees receiving these subsidies are concentrated in a few southern states.
He pointed out, “The rates in the South are significantly higher because, even with federal assistance, most of these states did not expand Medicaid under the ACA in 2010 or during the American Rescue Plan Act in 2021.” Of the 10 states with the largest proportion of their population receiving Obamacare subsidies, eight are in the South. Not surprisingly, these states also supported President Donald Trump in the last election. This group includes Florida, Georgia, Texas, Mississippi, South Carolina, Alabama, Tennessee, and North Carolina, while Utah and Wyoming make up the other two Republican states in the top ten.
Interestingly, in states where Medicaid was expanded under the ACA, a greater number of low-income individuals have gained access to health insurance. However, in states that haven’t expanded, those who don’t qualify for Medicaid can rely on subsidies to enroll in Obamacare plans, making costs almost negligible.
Enrollment in the ACA has more than doubled since 2020. Yet, once the subsidies are gone, those who enrolled will have to bear the full burden of the costs.
Data shows that 57% of ACA enrollees reside in congressional districts represented by Republicans. In regions like Florida, Georgia, Mississippi, and South Carolina, every congressional district has at least 10% of its population enrolled in Obamacare plans. This situation is similar across many districts in Texas and Utah.
The Congressional Budget Office has estimated that extending these ACA subsidies could be expensive—around $35 billion annually. Conversely, if they are allowed to expire, it could lead to approximately 4 million more uninsured individuals by 2034.
Aside from the financial implications, rising health insurance costs might also carry political ramifications. Affordability was a significant concern during last week’s off-year elections, and the issue of subsidies is likely to resurface in next year’s midterms.
KFF noted that although a smaller segment of the U.S. population is covered through the ACA Marketplace, the number of enrollees in certain districts could potentially influence the outcome of closely contested elections.
