Why 22 Million Americans May Face a Sharp Rise in Health Insurance Premiums in 2026

Millions of Americans who rely on the Affordable Care Act (ACA) marketplace for health insurance could face a steep rise in premium costs starting in 2026 — unless Congress acts swiftly to extend key tax credits.

While a recently passed $4 trillion Republican tax package — dubbed the “big beautiful bill” by former President Donald Trump — extended several expiring tax provisions, it notably left out a vital component for healthcare consumers: the enhanced premium tax credits that have been lowering insurance costs since 2021.

What Are Enhanced Premium Tax Credits?

Enhanced premium tax credits were first introduced under the American Rescue Plan Act in 2021 and later extended through 2025 by the Inflation Reduction Act. These credits have significantly reduced the cost of health insurance for those purchasing coverage through the ACA marketplace.

Originally, ACA premium subsidies were available to individuals earning between 100% and 400% of the federal poverty level. The enhanced credits removed that income cap, allowing higher-income households to qualify. They also capped the out-of-pocket cost of insurance premiums at 8.5% of a household’s income.

This change made insurance more accessible and affordable for millions — especially middle-class families who previously earned too much to qualify for subsidies but still struggled with high premiums.

What Happens in 2026?

Unless Congress extends the enhanced credits before they expire at the end of 2025, millions of ACA enrollees will see premium spikes starting January 1, 2026.

According to KFF (Kaiser Family Foundation), more than 22 million people — 92% of ACA enrollees — currently benefit from these subsidies. Without them, average premiums could rise more than 75%, according to Larry Levitt, KFF’s executive vice president for health policy.

In 2024, these tax credits saved the average ACA marketplace enrollee $705 annually, a 44% discount on premiums. The rollback of this support would dramatically impact household budgets and force many to reconsider their coverage.

Millions Could Lose Coverage

The financial impact could also lead to widespread coverage losses.

The Congressional Budget Office (CBO) estimates that if the enhanced subsidies lapse:

• 4.2 million people could become uninsured over the next decade.

• An additional 12 million people could lose coverage due to over $1 trillion in Republican-led spending cuts to healthcare programs like Medicaid and the ACA.

According to experts, this represents the largest rollback of federal healthcare support in U.S. history.

Who Will Be Hit the Hardest?

The expiration of the enhanced tax credits would affect:

• Middle-income Americans who were newly eligible for subsidies due to the income cap lift.

• Low-income families who saw their premiums drop to nearly zero in some states.

• Older adults whose premiums are often higher due to age-based pricing.

In other words, the expiration could be felt across the socioeconomic spectrum, but especially among those who recently gained coverage thanks to the expanded eligibility.

What’s Next?

Healthcare advocates are urging Congress to act quickly to extend the enhanced tax credits before the 2025 deadline.

If no action is taken, the consequences could be severe — both financially and in terms of public health. ACA enrollment has already more than doubled since 2020, rising from 11 million to 24 million in 2025. Letting these tax credits expire could reverse much of that progress.

Bottom Line:

Unless Congress renews the enhanced premium tax credits, 22 million Americans may see dramatic hikes in their health insurance premiums beginning in 2026 — with millions potentially losing coverage altogether. This looming deadline should be a priority in upcoming policy discussions.