Healthcare Organizations Face Major Shifts as ACA Premium Tax Credits Set to Expire

The countdown is on. In less than a year, healthcare organizations and millions of Americans face a financial cliff when ACA Marketplace Open Enrollment begins Nov 1, 2025. Enhanced premium tax credits that have kept insurance affordable for years are vanishing, and patients could see their costs more than double overnight. For healthcare providers, this perfect storm of policy changes threatens to increase uncompensated care, disrupt treatment continuity, and create new administrative burdens at a time when many are still recovering from pandemic-era challenges.

Understanding the Financial Impact on Patients

The most immediate concern for healthcare organizations is the scheduled expiration of enhanced premium tax credits at the end of 2025. According to the Kaiser Family Foundation (KFF), this change could result in subsidized enrollees seeing their out-of-pocket premium payments increase by an average of 114%.

For patients with incomes below four times the federal poverty level ($62,600 for an individual), financial assistance will continue but at reduced amounts. Those with incomes above this threshold may lose eligibility for subsidies entirely, facing both lost tax credits and rising insurer costs.

The Congressional Budget Office projects substantial coverage losses if these enhanced credits expire. This could leave many patients without adequate insurance, potentially increasing uncompensated care for providers and affecting continuity of care.

Higher Deductible Plans and Catastrophic Coverage

Healthcare organizations should anticipate changes in patient insurance composition, as individuals facing higher premiums may select different coverage options. The Trump administration has announced plans to expand access to catastrophic health plans, which will have an annual deductible of $10,600 for an individual or $21,200 for a family in 2026.

Additionally, changes to health savings account (HSA) rules will automatically treat all Marketplace bronze and catastrophic plans as high-deductible health plans, making them eligible to be paired with HSAs. While this provides some financial options for patients, healthcare organizations may face challenges with higher patient responsibility portions and potential collection concerns.

Patients with high-deductible plans often delay care or struggle to meet their financial obligations, which can impact both patient outcomes and provider revenue cycles.

Implications for Healthcare Revenue Cycle Management

The elimination of tax credit repayment limits creates additional financial uncertainty for patients. Starting in 2026, Marketplace enrollees will be required to repay the full amount of any excess tax credits when filing taxes.

This change particularly affects self-employed individuals and gig workers who make up a significant portion of Marketplace enrollees and often experience income variability. If patients unexpectedly exceed income thresholds, they could face repayment obligations of thousands of dollars, potentially affecting their ability to pay for healthcare services.

Reduced Enrollment Support and Narrowing Eligibility

The Centers for Medicare & Medicaid Services (CMS) has reduced federal Navigator funding by 90%, from $100 million to just $10 million for the 2026 plan year. This significant cut will limit resources available to help consumers navigate coverage options, potentially resulting in fewer patients successfully enrolling in appropriate plans.

Several policy changes will also restrict ACA eligibility for certain populations:

• The low-income special enrollment period has been eliminated, preventing year-round enrollment for those with incomes below 150% of the federal poverty level
• Lawfully present immigrants with incomes below 100% of the federal poverty level will lose eligibility for subsidized coverage
• Deferred Action for Childhood Arrivals (DACA) recipients are no longer eligible for Marketplace coverage or subsidies

Healthcare organizations serving these populations should prepare for potential changes in insurance status among patients.

Legal Challenges and Uncertainty

Adding to the complexity, several planned regulatory changes have been temporarily blocked by a federal court in Maryland. The case, City of Columbus et al. v. Kennedy, questions the Trump Administration’s authority to implement certain changes to Marketplace enrollment processes.

While the legal proceedings continue, healthcare organizations should stay informed about which provisions are in effect. This uncertainty creates additional administrative considerations for healthcare finance teams trying to guide patients through the enrollment process.

What Healthcare Leaders Should Consider Now

As these changes approach, healthcare organizations might want to take proactive steps:

1. Analyze patient populations to identify those likely to be affected by subsidy changes
2. Strengthen financial counseling services to help patients navigate coverage options
3. Review charity care and financial assistance policies
4. Communicate with patients about upcoming changes
5. Monitor state and federal policy developments

Looking Ahead to 2026

The combined impact of these changes creates uncertainty for healthcare organizations and their patients. While legal challenges continue and Congress could still act to extend enhanced subsidies, healthcare leaders should consider preparing for shifts in patient coverage and financial responsibility.

Need clarity on how these changes may impact your reimbursements or compliance obligations?

The James Moore healthcare team can help you interpret the numbers and prepare your strategy. Contact us today.

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