Skyrocketing ACA premiums force enrollees to make tough decisions

By Tami Luhby, Gabe Cohen, CNN

(CNN) — Late last month, Elizabeth Wick got the email she had been dreading. Her insurer, Blue Cross and Blue Shield of Texas, told her that the monthly premiums for her Affordable Care Act policy would soar to $1,380 next year, up from $862.

Wick, 57, currently gets $400 in federal premium subsidies, which makes the monthly cost of her health insurance more manageable. But the Arlington, Texas, resident is not counting on that assistance for next year since she also received a letter from the federal Obamacare exchange saying she likely won’t be eligible for any help in 2026 if the enhanced subsidies expire as scheduled at year’s end.

The rising health insurance rates and lapsing subsidies could upend Wick’s life. A therapist who focuses on sexual assault survivors, she launched a full-time private practice earlier this year but depends on Obamacare coverage since she has preexisting medical conditions. However, having to pay three times her current tab is unaffordable and could force her to give up her practice and find a job that offers health benefits.

“Health insurance will determine what my life will look like, whether or not I can continue with my private practice,” said Wick, who ruminates over the situation before she goes to sleep and when she’s out for her daily walks.

Agonizing tradeoffs

Wick is among the millions of Americans with Affordable Care Act policies who must contend with the looming lapse of the enhanced subsidies. The increased cost of coverage can lead to agonizing trade-offs for many enrollees, including cutting back on other necessities, trying to avoid getting care or forgoing health insurance entirely.

The issue is at the center of the stalemate on Capitol Hill, which has led to a record federal government shutdown. Democrats say they will only support a federal funding package for fiscal year 2026 if it also extends the more generous assistance, but Republicans say they will only negotiate after the government reopens.

The enhanced subsidies have enabled many lower-income Americans to obtain coverage with no or very low monthly premiums and broadened eligibility for assistance to many middle-class consumers. Obamacare’s original subsidies, which are part of the 2010 health reform law and are not expiring, are only available to those who earn less than four times the federal poverty level, or about $63,000 for an individual and $129,000 for a family of four.

Enacted by a Democratic-led Congress during the Covid-19 pandemic in 2021, the extra assistance helped spur a record 24 million people to sign up for Obamacare policies this year, with many new enrollees hailing from states that voted for President Donald Trump in 2024. More than 90% of policyholders receive subsidies.

The expiring beefed-up subsidies, along with rising health care costs, contributed to insurers hiking rates by 26%, on average, for next year, according to federal data.

But what enrollees will actually pay will be far higher because they won’t have the additional aid. Premium payments will more than double, on average, according to KFF, a nonpartisan health policy research group.

Certain policyholders will be hit harder than others. Those with incomes just above the poverty level will go from paying $0 or nearly $0 in premiums to being on the hook for a few hundred dollars a year, said Cynthia Cox, KFF’s director of the Program on the ACA. Nearly half of enrollees are in this group.

“For them, it’s a lot of money,” Cox said. “It may be a big enough increase that they feel they can’t afford it.”

Also, enrollees in their 50s and early 60s, who already pay a lot for coverage, will have to shell out even more. An older couple making $85,000 a year could see their premiums skyrocket by more than $20,000 a year, she said.

“It’s hard to imagine that many of them will be able to afford to continue that coverage,” Cox said.

That’s the situation that Sunni Montgomery finds herself in.

‘I have fought this so hard. I want to live.’

At 63, Montgomery is facing a relentless battle with lung cancer. Since 2022, she’s undergone multiple rounds of chemotherapy and radiation, relying on her ACA marketplace plan to cover the mounting costs. Thanks to enhanced subsidies, her premium this year was $541 a month — just manageable with Social Security Disability and a part-time job.

But next year, without those subsidies, she says her premium is set to soar to $1,758 a month — far outside her budget.

“I have to face the reality that I am probably going to become a late-stage cancer patient who’s uninsured,” Montgomery said. “I have fought this so hard. I want to live.”

Now on daily oxygen and getting scans every three months, she says she’s at high risk for recurrence. Without insurance, those lifesaving treatments will be out of reach.

“If I’m not getting scans and we don’t know if something’s recurred, then what that can mean is the end of me,” said Montgomery, who is racing to squeeze in every scan and checkup she can before her coverage expires.

Similarly, Chris and Donna Vetter have made the agonizing decision to drop their health insurance, saying they simply cannot afford it.

Chris, 62, is a retired federal worker, and Donna, 60, runs a small medical billing business. They relied on their ACA plan — reduced to $401 a month by the enhanced subsidies — to manage Donna’s asthma and Chris’ atrial fibrillation. But next year, their premium is set to skyrocket to $1,975 a month — nearly half their income.

They pored over options on the ACA marketplace but say even the cheapest plans hovered near $1,000 a month. Yet those policies “have huge deductibles, big copays, and they don’t cover a lot, so effectively it’s like not having insurance anyways,” Chris said.

Now, the Vetters, who live in rural Somerset County, Maryland, are bracing for a future without coverage — expecting to cancel appointments, forgo screenings, skip medications, and cross their fingers that disaster doesn’t strike.

“I’m just scared, and I don’t know what to do,” Donna said. “If anything should go wrong — God forbid a car accident, heart attack, cancer — we’ll have nothing.”

Planning for the unexpected

Soaring premiums have also left Alison and her husband, Chris, who live in Carson City, Nevada, debating over what to do about their Obamacare coverage. They began buying policies on the exchange three years ago, when Chris, a former police officer, had to retire after a serious injury.

This year, they are paying only $183 a month after nearly $1,350 in subsidies. But next year, their policy will cost $936 after some subsidies. They are contemplating buying a less expensive plan with a much higher deductible, though that will force them to think twice about going to urgent care or the emergency room.

“Just to even be in a situation where you have to think about, well, do I really need it? Do I really need that medication? Do I really need to go to the urgent care? God forbid, do I really need to go to the ER or can I, for lack of a better word, suck it up?” said Alison, who asked that only her first name be used because of her husband’s former profession. “I mean those are all decisions that we’re going to be forced to have to make.”

Younger Americans are also grappling with the increased costs.

Kris McKegney, 23, now pays $300 a month after subsidies for a higher-end plan with only a $3,000 annual deductible. Keeping the same plan would cost him $1,250 a month because he doesn’t expect to qualify for any assistance. That amount is out of the question, said the self-employed accountant.

One option he’s considering is signing up for a $400-a-month catastrophic plan, which would require him to pay for all his medications, doctor visits and therapy appointments. Another is enrolling in a policy with an $850 monthly premium and a $10,000 deductible that would provide more coverage. But the latter would entail dipping into his retirement fund, pausing his efforts to save for a down payment on a house and raising rates on his clients, which are mostly nonprofit organizations.

A Vermont resident, McKegney said health care is important to him because he is transgender. The battle on Capitol Hill over the enhanced subsidies, also known as advanced premium tax credits, makes him feel “degraded.”

“The tax credits have helped millions of people access health care, and it seems very cruel to then take that away,” he said.

The enhanced subsidies’ looming expiration led Nolan LeRoux and Emily Clute to contemplate drastic measures to retain at least some assistance. The couple, both 35, were set to get married on Saturday but have considered not filing their license after the ceremony. That’s because they are more likely to qualify for Obamacare’s original subsidies as individuals than as a married couple — the income threshold for a couple is less than double that of a single person.

Otherwise, the Bethlehem, New York, residents are looking at paying more than $1,360 per month next year for coverage, nearly double the total of what they’d pay as individuals for the same plan with some assistance. If the enhanced subsidies are extended, they would be eligible for more aid, even as a married couple.

Since they aren’t comfortable going without insurance, the couple may end up working more to help cover the cost. He is a barber, and she is a tattoo artist. But they aren’t happy about having to spend more time apart as newlyweds to pay for higher premiums. What’s more, the higher tab would also weigh on their honeymoon plans, dampening any thought of going to California.

Ultimately, though, the stress of not having health insurance would be greater than the concern of how to pay for it since anything could happen, like being hit by a drunk driver, LeRoux said.

“There are not many things health care-wise that are particularly affordable,” he said. “It’d be a lot of stress because I don’t know exactly how we would pay for a medical bill that was in the five figures.”

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