Nearly 35,000 Oregonians who buy insurance through the state’s Affordable Care Act market will lose all financial help if enhanced tax credits aren’t extended

By Alex Baumhardt, Oregon Capital Chronicle

More than 111,000 Oregonians who buy health insurance through the state’s Affordable Care Act marketplace will pay significantly more for their plans next year unless Congress intervenes, and nearly 35,000 will lose all financial help paying for monthly premiums and out-of-pocket costs.

That’s because congressional Republicans did not renew in their tax and spending bill passed this summer a pandemic-era enhanced tax credit meant to help lower the cost of plans for more than 24 million Americans and businesses who buy insurance through states’ Affordable Care Act (ACA) marketplaces.

The credits expire at the end of the year unless Congress extends them. While Republicans hope to pass a stop-gap spending bill by Tuesday to avoid a government shutdown, Democrats have said they won’t consider any bill that does not extend the credits.

Without the credits, the average Oregonian buying health insurance through the marketplace will pay $127 to $456 more per month in 2026, depending on their income level, according to the Oregon Health Authority. Anyone making over 400% of the federal poverty level — that’s about $62,000 a year for a one-person household, $84,000 for a two-person household and $128,000 for a four-person household — would no longer receive the enhanced tax credits.

People over 400 percent of the FPL have always been able to access the Marketplace, but have been ineligible for financial help. The enhanced premium tax credits only extended eligibility for premium tax credit to people at incomes over 400 percent of the FPL.

The credits were introduced in 2021 as part of the American Rescue Plan, a COVID-19 stimulus package, and expanded income eligibility and access to marketplace plans, doubling by 2025 the number of Americans able to buy health insurance through states’ ACA marketplaces.

The credits increased the income ceiling for credit eligibility. Previously, households earning more than 400% of the federal poverty level annually could not get financial help from the tax credits. Under the enhanced credits, households above 400% of the federal poverty level have out-of-pocket premiums capped at 8.5% of their household income.

People over 400 percent of the FPL have always been able to access the Marketplace, but have been ineligible for financial help. The enhanced premium tax credits only extended eligibility for premium tax credit to people at incomes over 400 percent of the FPL.

If Congress does not extend the credits, premiums for Americans enrolled in health plans through ACA marketplaces will rise an average of 75% next year, according to analysis from KFF, a health policy organization.

Premiums differ based on age and geography, and the rises would impact more young, low-income, urban enrollees, as well as enrollees in rural areas with moderate incomes. Average premiums in rural areas are expected to rise 90%, according to the Congressional Budget Office, leaving about 4 million more Americans uninsured next year.

Republicans have argued that Congress can debate extending the enhanced tax credits in November or December, but open enrollment for the ACA marketplace plans opens in November.

Without the certainty that they can afford higher premiums if the credits expire, many will choose not to enroll at all and go without health insurance in 2026, said Oregon state Treasurer Elizabeth Steiner at a Thursday news conference hosted by Americans for Responsible Growth, a national advocacy group that works with state financial leaders.

Steiner, a physician who served as the state Senate’s chief budget writer before becoming treasurer, said that the rising premiums will have cascading effects through Oregon’s economy. That’s in part because many small business owners, who must by law provide employees with health insurance, buy that coverage through the state’s ACA marketplace and will have to pay higher premiums without the tax credits.

“They’re going to lay off people because they can’t afford payroll. That, in turn, will result in decreased revenues from both corporate and personal income taxes, which will have a huge impact on our state’s bottom line, since we are one of the few states without a sales tax,” she said.

It will also create conditions, she said, where people will go without insurance, avoid and delay getting medical help, and skip or be unable to work as their conditions deteriorate.

“Good health care is good for business. Businesses depend on healthy employees who come to the workplace ready and able to do their jobs, not call out sick, or be less productive because of their illnesses,” she said.

Alex Baumhardt has been a national radio producer focusing on education for American Public Media since 2017. She has reported from the Arctic to the Antarctic for national and international media, and from Minnesota and Oregon for The Washington Post. This story first appeared in the Oregon Capital Chronicle.