Over 500K Ohioans to face higher healthcare costs as ACA subsidies end
TL/DR –
The Affordable Care Act subsidies have officially expired, leading to an expected rise in health insurance costs for hundreds of thousands of Ohioans. These subsidies were used as a bargaining chip to end the federal government shutdown last year with Democrats insisting on an extension for tax credits helping roughly 22 million Americans pay for Affordable Care Act marketplace plans. If the extension is not agreed upon, premiums are expected to increase, potentially pricing some individuals out of coverage altogether, with Ohio potentially seeing an additional 140,000 uninsured people, increasing the state’s uninsured rate by 29%.
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Ohio Health Insurance Costs Poised to Surge as ACA Subsidies Expire
Residents of Ohio are steeling themselves for a steep rise in health insurance costs as subsidies fuelled by the Affordable Care Act (ACA) come to an end. The expiration of these subsidies signals the cessation of financial assistance that has kept premiums low for marketplace plans for several years.
The Politics behind Healthcare Affordability
In the backdrop of the federal government shutdown last year, the accessibility of affordable healthcare for Americans emerged as a negotiation tool. Democrats demanded an extension for tax credits that assisted about 22 million Americans to afford ACA marketplace plans. In return for the Democrats’ support to reestablish the government, Senate Republicans promised a vote on the issue before the end of the year. However, such a vote never took place, and the fate of the extension now lies in the hands of the House of Representatives, with a vote expected in January. Yet, there is no certainty of success. This has left millions of Americans, including over half a million Ohioans, grappling with a substantial escalation in healthcare costs.
Impact of Lost Subsidies on Ohio Residents
Without the subsidy extension, premiums are projected to soar. In Ohio, about 513,000 people out of over 583,000 individuals with ACA plans, accounting for 88% of enrollees, will be affected. This puts these Ohioans at the risk of their healthcare costs rocketing, which could eventually lead to some losing their coverage completely. Dr. Arthur Lavin, a retired pediatrician and co-chair of Doctors Organized for Healthcare Solutions, warns, “When you push someone off their health insurance, you’re condemning them to not getting health care, and that could be deadly or impairing.”
The Significance of Tax Credit for Ohio
Introduced in 2021 as a part of a relief package during the COVID-19 pandemic and later extended through the Inflation Reduction Act till 2025, the tax credits greatly reduced premiums for most marketplace plans. The introduction of these credits saw the average monthly premium for federal marketplace enrollees in Ohio decrease from $215 in 2017 to just $126 in 2025, according to the Health Policy Institute of Ohio.
Estimated Impact on Households in Ohio
The Health Policy Institute of Ohio estimates the potential effects on typical households:
- A single 27-year-old adult earning $35,000 will see annual payments increase from $1,033 to $2,615.
- A 35-year-old couple earning $30,000 will have their payments go from zero to $1,107.
- A 49-year-old couple with a 19-year-old child earning $90,000 will experience an increase from $6,246 to $8,964.
Insurance Abandonment Fears
Those enrolled in ACA marketplace plans typically earn too much to qualify for Medicaid but lack coverage sponsored by employers. This is why experts caution that the surge in costs could compel many to abandon insurance entirely. According to an estimate by the Urban Institute, the expiration of enhanced premium tax credits could result in an additional 140,000 uninsured individuals in Ohio, leading to a 29% rise in the state’s uninsured rate.
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