Reliance On Obamacare Subsidies Jumps To Over 22 Million

By Mish Shedlock of MishTalk

Wednesday, October 8, 2025 7:20 PM EDT

Image Source: Pexels

Political pressure on the budget showdown will mount.

ACA Plan Costs Expected to Jump

The Wall Street Journal discusses ACA Costs and Subsidies

Premiums for ACA plans are expected to increase steeply in most states next year, with many insurers hiking rates 20% or more, due largely to higher spending on patients’ care.

If the enhanced payments end, fewer enrollees will get help from subsidies, and the sums will shrink for those who still qualify for them. KFF, a health-research nonprofit, estimates that average annual out-of-pocket premium payments could more than double next year, to $1,904 from $888.

Democrats say they won’t budge on their demand that Republicans support the higher federal subsidies they first passed in 2021, which hold down costs for people with ACA plans. It is a core issue for the party’s base, and Democrats hope their stance will help them score points with voters like Wallace, whose monthly health-insurance bill would likely rise sharply if the enhanced payments lapse.

Republican lawmakers have warned of unsustainable government spending. Over the years, they have repeatedly taken aim at the signature health law of former President Barack Obama. But some congressional Republicans have privately voiced concern that the GOP will bear the blame if healthcare costs sharply increase as midterm elections loom.

The stakes are high because in the 15 years since its passage, the ACA, often nicknamed Obamacare, has become ingrained in the American healthcare system. The marketplace insurance now covers more than 24 million people.

The number of people receiving a subsidy jumped from 10 million to over 22 million as a result of Biden’s 2021 American Rescue Plan Act (ARPA).

Want more of something? Subsidize it.

Democrats made the enhanced tax credits “temporary” to disguise the true costs.

We are about to rediscover the definition of “temporary”.

When Will Republicans Cave on Democrat’s Government Shutdown Demands?

On October 3, I asked How Quickly Will Republicans Cave on Democrat’s Government Shutdown Demands?

Democrats’ Strategy

If Democrats can hang on for the rest of the month, healthcare premium notices will be sent.

Consumers can start shopping for next year’s coverage on November 1. Some ACA participants have already started receiving notifications about next year’s premium increases.

About 24 million people are enrolled in ACA (Obamacare) coverage. Roughly that many people will not be happy with sticker shock.