Summary:
- Expiration of ACA enhanced tax credits and massive Medicaid expansion cuts will result in tens of millions of Americans losing health coverage or incurring unaffordable out-of-pocket expenses
- These massive loses in affordable health coverage will result in a projected 51,000 Americans dying prematurely annually and many more delaying needed health coverage.
- The Trump Administration’s proposed alternatives, such as expanding catastrophic insurance plans and sending ACA funds directly to insureds, are not likely to improve health care access or affordability.
The Affordable Care Act’s (ACA) enhanced tax credits expired at the start of this year, making health coverage much less affordable for 22 million Americans, including over 900,000 North Carolinians. Congress refused to extend the tax credits even after the longest government shutdown in history and months of negotiations. Congress eliminated these ACA tax credits, despite not having an alternative for these Americans.
The enhanced ACA tax credits have been on life support since Congress refused last July to extend them as part of its massive $4.1 trillion tax cut ( the so-called One Big Beautiful Bill Act). This Act also cut $911 billion over ten years in Medicaid spending, although these cuts conveniently will not go into effect until after the November 2026 elections. As a result, 16 million Americans are projected to lose health coverage. Millions more will have to pay much higher premiums or out-of-pocket expenses, straining their families’ budgets.
A recent public survey reveals that Americans now identify health care as their number one affordability issue. Sixty-six percent of Americans today are worried about the cost of health care– more than food, rent, utilities or transportation. Three of four uninsured American adults have skipped or delayed necessary health care in the last 12 months because of costs.
The lack of affordable health coverage is detrimental to Americans’ health. A recent Yale Public Health study estimates the One Big Beautiful Bill’s cuts will cause 51,000 premature American deaths annually. And many more Americans will skip or delay treatment, prolonging their illnesses and reducing their work productivity. Congress, in my view, has “Made America Unhealthy Again” by taking away affordable health coverage from tens of millions of Americans.
The Republican Congress Is Committed To Slashing Affordable Care Act Coverage
Nothing moved this Congress to extend the ACA tax credits.Not massive support from the American public. Not months of publicity, that premium costs would double on average for 22 million Americans. Not a forty-three day government shut down.
Congress has had no viable proposals to replace the ACA subsidies. Even if Cogress had alternatives, it did not have the many months needed to implement any replacement before the ACA subsidies expired. As a result, 1.3 million Americans have already dropped ACA coverage and growing. Unfortunately, North Carolina to date has had the largest drop in ACA signups, at 22%.
We do not have final ACA drop-off numbers. Enrollment is still open in a number of states with state-run ACA exchanges. In addition, many Americans were automatically re-enrolled in the ACA and are expected to drop coverage when they begin having to make sharply increased payments. Ultimately, 4 million Americans are projected to drop their ACA coverage.
Millions more Americans with ACA coverage are paying much more. Many will pay the much higher ACA premiums because they have little choice, being either older or having chronic illnesses. Many others have switched to skimpier ACA bronze plans with much higher deductibles and co-pays. Bronze plans this year have a $7476 annual deductible, which obviously many cannot afford to satisfy to get access to needed care.
The Republican majority appears to have refused to extend the ACA enhanced tax credits because of their deep-seated hatred of Obamacare (officially the Affordable Care Act):
‘Congressional Republicans can’t seem to quit the Obamacare repeal fight, even though the politics of the Affordable Care Act have changed a lot over the past 15 years,’ says Jonathan Oberlander, a political scientist focused on health care at the University of North Carolina at Chapel Hill. ‘It is, on balance, now a very popular program. Its main coverage policies, including the enhanced subsidies, have been in place for many years and have helped tens of millions of Americans.’
Tribalism and partisanship apparently trumped Americans’ health care needs.
It is important to remember that Americans did not vote in 2024 to dismantle the Affordable Care Act. The ACA was not a salient issue in the 2024 election, and President Trump repeatedly promised he would not cut Medicaid. After the election, the Republican Congress tried to inconspicuously undermine the ACA by failing to extend tax credits and making delayed, massive cuts to Medicaid– rather than frontally attacking the ACA as they did unsuccessfully in 2017 and 2018 with disastrous political results.
Lacking Affordable Health Coverage Is Bad For Your Health
Being uninsured or underinsured (with unaffordable out-of-pocket expenses) is bad for Americans’ health. Recent studies demonstrate that the uninsured and underinsured are likely to die prematurely and be sicker than those with affordable health coverage. An estimated 51,000 Americans annually will die prematurely because of these cuts—more than die yearly from car accidents. In addition, the uninsured and underinsured delay diagnosis and treatment because of unaffordable costs, exacerbating their illnesses.
It Is Also Bad For Your Financial Well-Being
Uninsured and underinsured Americans also suffer greater financial instability. One hundred million Americans are estimated to be saddled with medical debt. They owe at least $220 billion, with the majority being owed by Americans with over $10,000. Medical debt is a leading cause of personal bankruptcy. Unlike in our country, citizens in other high income countries with universal coverage do not incur medical debt when accessing health care. These ACA cuts will worsen American’s already troublesome medical debt and related bankruptcies.
The Coming 2026 Election Health Care Affordability Debate. Health care affordability is likely to be a central issue in the 2026 mid-term elections. Being politically charged, much health coverage misinformation will be spewed. The following discussion is intended to provide some basic facts and clearer perspective to the political debate.
President Trump’s Proposal To Expand Use Of Catastrophic Insurance Plans Will Not Provide Affordability
To reduce premiums, the Trump Administration has proposed a sweeping regulation to allow many more Americans to buy catastrophic health insurance on the ACA insurance exchanges. While premiums for catastrophic policies are cheaper, it is only because they “expose enrollees to much higher out-of-pocket costs.”
“The proposal would require out-of-pocket maximums on such plans to hit $15,600 a year for an individual and $27,600 for a family.” Since the median household income in the United States is $84,000, working- and middle-class Americans obviously cannot afford such an out-of-pocket hit. This proposed regulation would cause millions to delay care or take on substantial medical debt.
In my opinion, this proposal provides only an illusion of affordable health coverage: Americans would be able to better afford upfront the catastrophic policies’ premiums but would not be able to pay on the backend the out-of-pocket expenses to access health care.
The President’s Proposal that ACA Funds Go Directly to Individuals is Meaningless
The Trump Administration is also proposing that ACA funds go directly to insureds rather than, as currently, to ACA regulated insurance companies. Regardless, the funds would still end up going to pay for private insurance policies. I consider this faux populism.
There is a critical difference in bargaining power between individual insureds and the federal government in negotiating with insurance companies. Currently, under the ACA, the government regulates the insurance company’s rates and policy benefits to protect insureds. Under the Republican approach, individual insureds would be on their own to “negotiate” rates and coverage. In reality, most Americans do not understand the details of insurance policies, putting them at a huge disadvantage in trying to negotiate with sophisticated insurance companies. In the past, when there has not been government regulation of insurers, insureds often have been snookered.
Contrary to Opponents’ Assertions, The ACA Is Not Responsible for Higher Health Costs
A major argument against the ACA is the contention that expanding health coverage to millions of Americans is the cause of America’s high health care costs. But the evidence doesn’t support this assertion. First, the timing of our country’s steeply rising health care costs does not correspond with the ACA’s adoption. Health care costs in the United States began to raise sharply in the 1970s, much faster than in other high income countries. This sharp rise in health care costs began forty years before the ACA was adopted in 2010.
Second, expanding health coverage to tens of millions more Americans is not correlated with rising health care costs. All the world’s other high income countries have universal health coverage and much lower costs than our country. Our costs are the highest in the world, generally double that of other high-income countries. Furthermore, these countries’ citizens receive more health care, with as good or better results, than Americans. America’s health care costs more, not because of expanded coverage or better care, but because our outlier health care “system” produces higher prices.
Nor is health care industry consolidation, with greater industry price leverage, caused by the ACA. Health industry consolidation began in the 1980s, years before the ACA and has continued ever since. “At the end of the day, the ACA market never became that big to drive the overall restructuring of the industry. A lot of what they are attributing to the ACA would have happened anyway,” according to Chip Kahn, president and CEO of the Federation of American Hospitals.
There is rightly concern that health industry mergers and private equity buyouts threaten competition: It’s “not competition. It’s more like collusion. They don’t care about prices,” said Barak Richman, professor of business law at George Washington University. UnitedHealth Group, for example, now owns health insurance plans, physician practices, data services, payment processing companies, a pharmacy benefits manager, and pharmacies.
The Biden administration began to take aggressive steps to address health industry consolidation. The Trump Administration, however, seems less interested in preventing mergers.
What Then Does Work To Reduce Health Care Prices? Government Structured Negotiations and Budget Limits
Other high-income countries, whether they have government or private health insurance, do not use catastrophic plans or limit health coverage to reduce costs. They use health care budget limits and structured negotiations among government, employers, hospitals, health practitioners, and insurers. These stakeholders, unlike patients, have the resources and expertise to effectively negotiate services and prices. The government, with employers, has leverage to limit prices that individual insureds do not have. Some high-income countries establish prices, while others allow more flexibility, but none allow insurers and the health industry carte blanche to set prices without structured stakeholder negotiations.
Let’s Build Upon and Improve The ACA, Not Tear It Down for Half-Baked, Fanciful Schemes
The ACA was adopted 16 years ago, on March 23, 2010. Little understood and quite controversial at the time, the ACA now is widely supported by Americans. The ACA finances 90% of the cost for Medicaid expansion in 41 willing states. This expansion extends health coverage to 21 million low-income Americans. Almost 50% of America’s children today are covered by Medicaid or CHIP.
In addition, 25.2 million Americans received coverage through the ACA insurance exchanges in 2025. These government-regulated marketplaces offer affordable, comprehensive health coverage that is subsidized for lower- and middle- income Americans. Nearly half of America’s self-employed and employees of small employers receive their coverage through the exchanges.
The ACA protects these insureds by requiring private insurers on the exchanges to provide comprehensive benefits and limiting insurers’ rates. Last, but not least, the Affordable Care Act banned all health insurers from excluding coverage or charging people more because they have pre-existing conditions.
Since the ACA was adopted, the number of uninsured Americans has reached an all-time low, at 7.7%. Americans now pay a lower percentage of their income on out-of-pocket health expenses, although more reduction is needed. The ACA has also significantly reduced Americans’ medical debt.
America is much healthier, financially secure, and productive because of the ACA. Like all laws, however, there are reforms that can improve it by expanding health coverage, lowering out-of-pocket costs, and using government leverage to reduce health care costs. But destroying the ACA– for far-fetched theories not used by any other country– is not the answer.
In conclusion, Americans should pay close attention to this year’s health care debate. Please don’t accept pablum or pie-in-the-sky solutions. Your family’s health and finances depend upon your involvement.
