Some Iowans could see health insurance premiums double if federal subsidies expire
Roughly 150,000 Iowans could see monthly health insurance costs spike if enhanced Affordable Care Act subsidies expire at the end of the year.
Roughly 150,000 Iowans could see monthly health insurance costs spike if enhanced Affordable Care Act subsidies expire at the end of the year.
Roughly 150,000 Iowans could see monthly health insurance costs spike if enhanced Affordable Care Act subsidies expire at the end of the year.
The federal government has been shut down for weeks, and a big part of the fight in Washington is over health care.
At the center of the standoff is a debate over enhanced Affordable Care Act subsidies that help lower monthly insurance costs for people who get their coverage from the marketplace. The enhanced subsidies are set to expire at the end of the year.
Democrats want Republicans to extend the expiring healthcare subsidies before reopening the government. Republicans say they'll only negotiate after the government reopens.
The Affordable Care Act, or ACA, helps make health insurance more affordable for people who don’t get coverage through their job, Medicaid or Medicare. That includes self-employed people like farmers, freelancers and independent contractors — as well as small business employees and early retirees.
“Roughly 150,000 folks are getting their coverage through the marketplace in Iowa,” said Dan Shane, associate professor in the Health Management and Policy department at the University of Iowa.
Shane said those people receive subsidies, which are essentially discounts on their monthly premiums. During the pandemic, Congress expanded those subsidies, lowering or even eliminating premium costs for some families. The expansion also capped how much people have to pay each month based on their income, making insurance much more affordable for middle-class Americans.
“They had the most to gain because in some cases, the premiums were in the thousands of dollars per month for those folks,” Shane said.
Those enhanced subsidies are set to expire at the end of the year.
“If they were to lapse, on average, the premiums double,” Shane said.
That means someone paying $500 a month now could see their premium jump to $1,000 next year. The cost increase would vary based on income, location and age — with older people in more expensive areas paying the most.
“If you’re somebody who, again, is in that pre-Medicare, right, 60, 61 years old, maybe it’s you and a spouse or partner that you’re covering right now,” Shane said, “your insurance may be $600 or $700 a month. I mean, I’ve seen estimates that in some cases go to, you know, $1,800 to $2,000 a month for your health insurance.”
The nonpartisan Congressional Budget Office estimates that if the enhanced subsidies expire, 2.2 million Americans will lose their health care coverage next year.
Open enrollment begins November 1, and families must make their decisions by December 15 to have coverage in place for 2026.
“There could be a better option even within this environment where the enhanced tax credits are gone,” Shane said. “But there may be at least some savings available by switching plans.”
People who don’t qualify for subsidies but get their coverage from the marketplace could also see their premiums rise. Shane said that when healthier people drop their coverage, it drives up costs for everyone else.
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