The U.S. Senate is set to vote Thursday on two competing plans aimed at addressing the impending expiration of Affordable Care Act premium tax credits, though neither measure is expected to advance. The stalemate sharply increases the likelihood that health insurance costs will rise significantly for millions of Americans starting next month.
The vote stems from an agreement reached between Senate leaders during negotiations to reopen the federal government after last month’s prolonged shutdown. Roughly 21.8 million people currently receive subsidies that lower the cost of ACA marketplace coverage, but those tax credits are scheduled to end on December 31. Health policy analysts warn that annual premiums could more than double if the credits lapse.
Democrats are pushing legislation that would extend the subsidies through 2028, arguing that allowing them to expire would impose unaffordable costs on families already struggling with rising living expenses. Republicans are preparing to block that proposal, contending that continuing the subsidies would mask what they view as persistent failures of the health care law.
Republican senators have instead rallied behind an alternative focused on expanding the use of health savings accounts. Their bill would provide government payments of $1,000 to people enrolled in bronze or catastrophic marketplace plans—coverage tiers that typically come with high deductibles. Individuals aged 50 to 64 would receive an additional $500. Use of the funds would be restricted, including limits on paying for abortions or gender-affirming care.
Neither proposal currently has the bipartisan support needed to overcome the Senate’s 60-vote threshold, leaving both poised to fail. The impasse has drawn criticism from Democrats and independents who say the Republican-backed plan would shift more people into high-deductible coverage without addressing rising premiums or the broader affordability crisis.
The looming expiration of the subsidies comes as public concern over health care costs has intensified. The issue played a major role in the 2024 presidential race and has contributed to declining approval ratings for President Donald Trump, who this week signaled support for the Republican senators’ proposal. While he has previously suggested some openness to extending the tax credits, House Republican leaders remain opposed to renewing them.
Any Senate bill would also need to clear the GOP-controlled House, where the speaker has indicated plans to put forward separate proposals aimed at lowering health care costs. A bipartisan group in the House has already introduced its own framework calling for a shorter extension of the subsidies through 2027, along with new income caps and anti-fraud measures.
Source: The Guardian