Millions of Texans face huge premium hike as ACA tax credits expire
Published November 16, 2025 8:34pm CST
At the center of the government shutdown that came to a close on Wednesday, there was a debate over pandemic-era Affordable Care Act tax credits that are set to expire at the end of the year.
Government shutdown ends, subsidy debate continues
What we know: Although the government is now back open, congress has not yet come to an agreement on the future of those enhanced subsidies. If they're allowed to expire, state health care leaders say Texas will be hit the hardest.
Texas health coverage at risk
Nearly 17% of Texans don't have health insurance. That's the highest fraction of uninsured people in any state nationwide. Just five years ago, even more Texans were uninsured. But in 2021, enhanced federal subsidies under the Affordable Care Act more than tripled marketplace enrollment. Now that they're slated to expire, local health care leaders are sounding the alarm.
What they're saying: "Texas is going to be hit the hardest out of any other state," said Annie Spilman, the executive director of Texans for Affordable Healthcare, a nonpartisan consumer advocacy group. "In Texas right now and for the last several years, we've truly had a health care cost crisis."
Why Texas is vulnerable
Spilman says the reason Texas is particularly vulnerable is because the state chose to take a private-market approach to health care, rather than expand Medicaid. Texas also has a high number of health care mandates that exceed federal requirements, driving up regulatory costs and resulting in challenges like higher prices for prescription drugs.
"We have just consistently lagged behind other states in terms of the number of people who are covered," said Laura Dague, a professor of health policy at Texas A&M's who led a research team looking at the impact of the loss of subsidies at the state and county level in Texas. "We have some truly amazing healthcare facilities in the state that provide, you know, excellent state-of-the-art care, high level medical research coming out of universities and out of those hospital systems. The question has always been one of access: who gets those services and who doesn't?"
Higher uninsured rate and costs
Dig deeper: Dague says the loss of the subsidies will exacerbate that issue, making healthcare less accessible for many in the state. According to figures provided by researchers with Texas A&M, 1 in 6 ACA marketplace enrollees nationwide are Texans, and 95% of them receive a federal subsidy. In 2025, 4 million people across the state enrolled in a marketplace plan.
Should the enhanced premium tax credits expire, an analysis by Keep Americans Covered Texas predicts that the state's uninsured rate will rise by 27%.
"The cyclical result of that would be maybe small businesses shutting down or creating more unhealthy Texans that won't be able to stay employed or go out and work," said Spilman.
Who will be hit hardest?
Local perspective: Local health care leaders say the people who will be most affected from the loss of the subsidies are small business owners and their employees. Ranchers, gig workers, independent contractors and those who are self-employed, people between the ages of 55–64, and residents of rural areas. But ultimately, impacts are expected to be felt across the board.
"It increases the cost of providing care," said Carrie Kroll, vice president of advocacy and public policy for the Texas Hospital Association. "Not only does it increase the cost that hospitals will have to incur to make sure that they're basically paying for the people’s health care who can't pay for it, it's going to increase the cost for other individuals."
Researchers at Texas A&M predict that up to 1.45 million fewer Texans will enroll in a marketplace plan if the subsidies are not extended. That's based on an expected average increase of 115% in out-of-pocket premiums. With fewer people in the marketplace to share the costs of care, prices will rise for those who are still able to purchase plans.
To see how your premium could rise click here: https://www.kff.org/interactive/calculator-aca-enhanced-premium-tax-credit/
Hospitals face closures and service cuts
What's next: Community hospitals are also expected to take a hit. Depending on the population they serve, they may have to cut services or be forced to close altogether.
"If hospitals have a harder time staying open, we see different types of services might not be offered any longer if they're not going to be financially viable," said Dague. "A couple of examples we've seen [are] hospitals closing in rural areas, hospitals deciding not to offer maternity care anymore. It affects the types of things that our healthcare system is able to offer the rest of us."
Local healthcare leaders emphasize that this is not a partisan issue, but rather something that will have a real impact across the state of Texas.
What's next in congress?
Now that the government is back open, Republican lawmakers in Congress have promised they will vote on whether to extend the tax credits by mid-December.
https://www.fox7austin.com/news/millions-texans-face-huge-premium-hike-aca-tax-credits-expire