"With enhanced Affordable Care Act (ACA) subsidies due to expire within days, some Senate Democrats are scrambling to protect millions of Americans from getting the unpleasant holiday gift of spiking health insurance premiums. The CRFB says there's just one problem with the plan: it's not funded. "With the national debt as large as the economy and interest payments costing $1 trillion annually, it is absurd to suggest adding hundreds of billions more to the debt," CRFB President Maya MacGuineas wrote in a statement on Friday afternoon."
"Those subsidies, originally boosted during the pandemic and later renewed, were designed to lower premiums and prevent coverage losses for middle‑ and lower‑income households purchasing insurance on the ACA exchanges. CRFB estimated that even this three‑year extension alone would add roughly $300 billion to federal deficits over the next decade, largely because the federal government would continue to shoulder a larger share of premium costs while enrollment and subsidy amounts remain elevated."
Senate Democrats propose fully extending enhanced Affordable Care Act subsidies for three years, 2026 through 2028, with no additional income limits. The subsidies were originally increased during the pandemic and later renewed to lower premiums and prevent coverage losses for middle‑ and lower‑income households on ACA exchanges. The Committee for a Responsible Federal Budget estimates the three‑year extension would add roughly $300 billion to federal deficits over the next decade because the government would keep shouldering a larger share of premium costs while enrollment and subsidy levels remain high. A permanent extension could approach $550 billion in additional borrowing. The proposal would also reverse 2025 reconciliation law integrity measures and be financed through further federal borrowing amid roughly $1 trillion in annual interest costs.
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