Rising ACA Premiums Ahead as Credits Expire
Rising Costs Ahead for ACA Enrollees
Millions of Americans preparing to enroll in health plans through the Affordable Care Act marketplace this November will encounter significantly higher premiums. Insurers are raising their charges by an average of 26% nationwide, with some states seeing increases around 30% for benchmark silver plans. This surge marks a stark contrast to recent years when premium growth was more moderate.
The Role of Enhanced Premium Tax Credits
Enhanced premium tax credits, implemented in 2021 and extended through 2025, have softened the impact of rising premiums for most enrollees by capping their out-of-pocket costs based on income. However, these credits are set to expire soon. Without them, many people could face monthly premium payments more than doubling, especially those earning above 400% of the federal poverty level who might lose all subsidy eligibility.
What This Means for Consumers
For example, an individual earning $28,000 now pays about 1% of their income on premiums, but without the enhanced credits, this could jump to nearly 6% next year. This "huge sticker shock" could cause financial strain and may influence enrollment decisions across the country.
