WASHINGTON – Over 180,000 Maryland residents could face major increases in health care costs next year as the Saturday deadline to extend enhanced Obamacare subsidies rapidly approaches.
“The premium increases that are set to go into effect will be crippling for Marylanders,” Rep. Johnny Olszewski, D-Maryland, told Capital News Service.
Lawmakers appear to be at an impasse over renewing the COVID-era program, which expanded the eligibility of recipients and the amount of federal health care tax credits. Those provisions are part of the Affordable Care Act, also known as Obamacare, designed to reduce health insurance costs for households below a certain income.
The deadlock is at the center of the federal government shutdown. Democrats are insisting on the extension of Obamacare subsidies as part of any deal to reopen the government.
In Maryland, average overall health care costs are expected to increase by 13.4% in 2026, according to the Maryland Insurance Department. For those no longer eligible for the expanded subsidy program, insurance costs are estimated to rise between 95%, according to Maryland Gov. Wes Moore, and 154%, according to the Center for American Progress.
“That is a huge additional cost for families that are already working paycheck to paycheck and struggling to pay their bills,” said Sen. Chris Van Hollen, D-Maryland.
Sen. Angela Alsobrooks, D-Maryland, told CNS that “Marylanders cannot afford these spikes in health care. A couple in Salisbury making $90,000 a year could see their health care costs rise by over $1,000 a month.”
While subsidies for ACA insurance have existed since 2014, eligibility and amounts for these subsidies were expanded in 2021.
Since then, nationwide enrollment in ACA insurance has more than doubled, with over 24 million Americans relying on the program for health care. Maryland alone contains around 250,000 members, with a large majority benefitting from enhanced subsidies.
Now, this temporary provision is set to expire, reducing the amount of subsidies available.
“Our health care system is deeply interconnected,” Rep. Sarah Elfreth, D-Maryland, told CNS. “Ripping away ACA tax credits after Republicans passed the largest cut to Medicaid in American history…puts us on the precipice of one of the largest health care crises in our nation’s history.”
Health care costs go up each year due to inflation, but 2026 premiums are expected to increase at twice the rate of inflation.
To put this into perspective, according to KFF, individuals who make up to $18,000 are eligible for a zero premiums plan. Without the credit, those individuals would have to pay $378 a month for federal health insurance.
“If Republicans in Congress continue to refuse to address these expiring tax credits, many of my constituents (and theirs) will have no choice but to drop their health care coverage to make ends meet.” Rep. Kweisi Mfume, D-Maryland, told CNS.
The Urban Institute estimates that around 33,000 Maryland residents may lose health insurance altogether as a result of the rising costs. Middle class Americans will be particularly hard hit, as those earning an income over four times the poverty rate will no longer qualify for ACA subsidies.
“The one tax cut that they let lapse was a tax break for middle class families to better afford healthcare – that premium tax credit,” Van Hollen said.
In response to the looming price hike, Maryland expanded state-funded health care insurance assistance programs for households earning below four times the federal poverty limit.
Renewing the expanded subsidies would insure 3.8 million additional Americans over the next decade, but the Congressional Budget Office estimates it will cost around $350 billion. Democrats and Republicans still remain at odds on the question.
“I think that subsidies is one area that we can find compromise on, but we also will never reach those compromises if we aren’t even talking to each other,” Olszewski said.
While Democrats have rallied behind the ACA expansion, Republicans are more reluctant to entertain health care discussions while the government remains shut down.
Over a dozen House Republicans signed on to a letter to Speaker Mike Johnson, R-Louisiana, on Oct. 21 urging health care reform, but saying “the government funding debate is not the time or place to address health care issues.”
Instead, Republicans said they are more in favor of reforming Obamacare to lower premium costs, rather than subsidizing premiums.
“We think the solution is to try to do something to make sure all the premiums go down,” said Rep. Andy Harris, R-Maryland. “And I don’t mean just to subsidize premiums, I mean the premiums themselves.”
While acknowledging concerns about increased premiums, Republicans cautioned against alarmism.
“The Affordable Care Act…is not going away. That’s a myth that’s being perpetuated by the Democrats,” Harris said. “There will still be an average of an 80% subsidy of the Affordable Care Act premiums.”
Johnson said “we were always planning to continue the debate and discussion about that issue in October and November. Ironically, Democrats are taking the time off the clock for us to do that.”
These effects will be reflected on Maryland’s healthcare enrollment website starting on Saturday, when open enrollment begins.