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Stalemate in Congress leaves millions insured by state marketplaces in limbo. For months, as the expiration of health insurance subsidies loomed, state health insurance commissioners warned that millions of middle-class Americans were likely to see their insurance premiums double or triple.
Now, Washington is at a stalemate. The government has shut down. Democrats say Congress needs to permanently extend the credits before open enrollment for state health insurance marketplaces begins on November 1. Republicans argue they will not discuss health policy as part of reopening legislation and can deal with subsidies later in December.
The reality on the ground is that people are already being notified of expected cost increases. Insurance companies have submitted their rates, and open enrollment starts in less than a month, leaving little time to make adjustments. “People see that December 31st date, but it really is that people are making decisions within weeks from now,” said Devon Trolley, Executive Director of Pennsylvania’s insurance marketplace.
Trolley said if Congress waits until open enrollment begins or the end of the year, it will be “chaotic” and “messy.” Even if Congress acts to extend tax subsidies later, insurance commissioners fear the damage will have been done and at least hundreds of thousands of Americans will be newly uninsured. Until recently, the deadline felt far away, but getting Congress to listen was difficult.
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Democrats are pushing one of their few opportunities as the minority party to push back on recent GOP health care changes. Republicans argue that discussions about subsidies can wait until the government is reopened.
There is some movement behind closed doors. A bipartisan group of senators has begun quietly meeting to find a path forward, and cracks in the Republican position are starting to show. Georgia Republican Rep. Marjorie Taylor Greene broke with House leaders in supporting extending the subsidies on October 6. That same day, President Trump indicated that the subsidies might be a negotiating point.
Godfread is still hopeful Congress will extend the subsidies before open enrollment begins or at least early in the window. “The challenge we have right now is the timing of it all,” he said. “We are up against the absolute deadline.”
About 24 million people use marketplaces to buy insurance, with nearly 92% receiving some form of subsidy. If Congress doesn’t act and subsidies expire at the end of 2025, premiums would rise by more than 75% on average.
Because of uncertainty, many states asked insurance companies for two sets of rates: one if enhanced subsidies ended, and another if they were extended. “We really built our planning around a go-no-go of Sept. 30,” said Jessica Altman from Covered California. The no-enhanced subsidy rates were loaded into their system when the government closed on that day.
Without enhanced subsidies, younger and healthier people will not purchase insurance, leaving an older and less healthy pool. “The ones who need health coverage because their life literally depends on it ‒ they will continue to stay,” Trolley said.
Even if Congress acts soon, delays and confusion are likely. It could take a month or two for lower rates to be implemented and inform consumers of changes. Altman fears that those who walked away from insurance won’t return even if subsidies are extended later in the year.
If tax breaks are extended at the end of December, or early next year, many people will have lost coverage due to Congress failing to act soon enough.
