The longest government shutdown in U.S. history might finally end. Eight Democrats are ready to team up with Republican colleagues, leaving behind a critical demand related to healthcare coverage. This standoff is primarily due to Republicans resisting calls to extend federal subsidies for those purchasing health insurance through the Affordable Care Act (ACA) market. These subsidies, introduced during the pandemic and extended through the Inflation Reduction Act (IRA) in 2022, are set to run out at the end of this year.
Previously, Democrats refused to pass former President Trump’s spending bill unless these subsidies were extended. Meanwhile, many polls indicated public blame towards Trump and his party for the shutdown.
Recently, the eight Democrats softened their stance. In exchange for their votes to end the shutdown, Senate Majority Leader John Thune—a Republican from South Dakota—agreed to hold a vote in mid-December on an extension for ACA subsidies. Democrat Tim Kaine defended this move, asserting that it ensures a vote, something Republicans had previously neglected.
But while this compromise might end the shutdown temporarily, it doesn’t resolve the underlying issue for millions. Healthcare costs could skyrocket if these subsidies expire.
In 2025, around 24 million people accessed insurance through the ACA marketplace, and 93% of them benefited from tax credits that made healthcare more affordable. If those subsidies vanish, experts warn that premiums for approximately 22 million Americans could double or even triple. A study from the Kaiser Family Foundation noted that 57% of those enrolled in the ACA marketplace are from Republican districts.
Older adults are particularly vulnerable. The subsidies helped cut the uninsured rate among those aged 50 to 64 by 50%. According to the Congressional Budget Office, losing these subsidies could lead to around 4 million more Americans becoming uninsured, increasing the burden on Medicare and local hospitals.
Mark Shepard, a professor at Harvard Kennedy School, highlights the broader implications: “The loss of insurance affects local governments and health providers.” If more people lose their insurance, hospitals and state services face greater financial pressures.
Insurers are also watching closely as potential volatility looms. Rising premiums might impact not only those relying on ACA subsidies but also affect those with employer-sponsored insurance. A recent report from Mercer predicts an average health benefit cost rise of 6.5% per employee in 2026—the sharpest increase in over 15 years. Furthermore, 59% of surveyed employers plan to make cost-cutting changes to their plans this year.
The stakes are high. If these subsidies expire, the consequences will ripple through the healthcare system, affecting millions and intensifying the ongoing debate about healthcare in America. For more insights on health policy changes, you can check the latest from the Kaiser Family Foundation.
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