The Senate on Thursday rejected legislation to extend Affordable Care Act (ACA) tax credits, essentially guaranteeing that millions of Americans and hundreds of thousands of Coloradans will see a steep rise in costs at the beginning of the year.
Senators voted on two partisan bills that they knew would fail — the Democratic bill to extend the subsidies, and a Republican alternative that would have created new health savings accounts.
An estimated 225,000 Coloradans who have health insurance through the ACA marketplace are expected to see significant increases in premiums starting Jan. 1. Because premiums will be unaffordable for many people, the Colorado Division of Insurance estimates that around 75,000 Coloradans could lose health insurance.
Denver7 anchor Shannon Ogden spoke with the executive director of the Colorado Consumer Health Initiative (CCHI), a nonprofit health advocacy organization that serves Coloradans whose access to health care and financial security are compromised by affordability, poor benefits, or unfair business practices of the health care industry.
Mannat Singh told Ogden Coloradans who have health coverage through the Affordable Care Act will see their premiums increase 101% on average, starting Jan. 1.
"They're showing up to the marketplace to either renew or buy and they simply can't afford it. Somebody who was used to a premium being $600 a month, which is already expensive enough, could see premiums close to $1,200 or $1,500 a month," Singh said. "Working Americans and working Coloradans can't afford that. So, they are making a choice between purchasing coverage or paying the rent or putting food on the table or paying for other life necessities that they need."
Denver
Connect for Health CO helps residents navigate healthcare premium increases
The Democratic plan voted on Thursday proposed a three-year extension of the enhanced Affordable Care Act subsidies that are otherwise set to expire on Jan. 1. The enhanced subsidies were originally put in place at the height of the COVID-19 pandemic.
Senate Majority Leader John Thune, R-S.D., said ahead of the vote that the Democrats’ simple extension of the subsidies is “an attempt to disguise the real impact of Obamacare’s spiraling health care costs.”
The Republican proposal would have done away with the enhanced tax credits and instead take the extra money from those tax credits and put it into health savings accounts for those who purchase bronze-level or "catastrophic" plans on the ACA exchanges. Republicans say this will help Americans pay for out-of-pocket costs.
“When people’s monthly payments spike next year, they’ll know it was Republicans that made it happen,” Schumer said in November, while making clear that Democrats would not seek a compromise.
More than 24 million people have health insurance through the ACA. That includes farmers, ranchers, small-business owners and other self-employed people without other health insurance options through their work.
National Politics
Senate rejects health care plans as ACA tax credits near expiration
Enrollees who make less than 400% of the federal poverty level qualify for permanent subsidies in the program that help them offset premium costs.
In 2021, Democrats in Congress added additional subsidies, known as enhanced premium tax credits, that apply to enrollees regardless of their income. Those subsidies are the ones set to expire Jan. 1.
With the expanded subsidies, some lower-income enrollees received health care with no premiums, and high earners paid no more than 8.5% of their income.
If the tax credits expire, the average subsidized enrollee will see their annual premium payments go up by 114%, from an average of $888 in 2025 to $1,904 in 2026, according to the health care research nonprofit KFF.
Some enrollees, especially those who are young and healthy, may drop out of coverage entirely rather than pay the steeper fees, experts say. A recent KFF poll found that 1 in 4 enrollees said they would “very likely” go without health insurance if their premiums doubled next year.
