On July 4, 2023, President Donald Trump signed a significant piece of legislation that alters health insurance coverage for millions of Americans. The law, often referred to as the “big, beautiful bill,” introduces changes to the Affordable Care Act (ACA), commonly known as Obamacare. These modifications could lead to increased premiums and additional requirements for those enrolled in marketplace health insurance plans.
Premium Increases on the Horizon
One of the most notable changes involves premium tax credits, which have been crucial in making marketplace insurance more affordable. According to estimates from KFF, enhanced premium tax credits have resulted in subsidized premiums being approximately $624 less expensive per year for 2024. However, these enhanced subsidies are set to expire after 2025, leading to a potential increase in premiums by 25% to 100% for members across all income levels. The Congressional Budget Office forecasts that this expiration could result in an additional 4.2 million individuals lacking health insurance by 2034.
Advocates are urging Congress to consider extending these enhanced subsidies before the deadline. Individuals may need to prepare for higher premiums if the subsidies are not renewed, and exploring alternative insurance options could become necessary.
Annual Re-Enrollment Requirement
The new law also changes the re-enrollment process for premium tax credits. Previously, individuals with marketplace insurance were automatically re-enrolled for the subsequent year, maintaining their eligibility based on initial application details. In 2025, nearly 11 million individuals were automatically re-enrolled, as reported by the Centers for Medicare & Medicaid Services.
Under the new provisions, eligibility for premium tax credits will no longer carry over annually. Starting in tax year 2028, individuals must actively re-verify their eligibility each year during the open enrollment period, or they risk facing significantly higher premiums. It is crucial for enrollees to be prepared to provide updated information regarding household income, family size, and immigration status.
Restricted Enrollment for Low-Income Individuals
The new legislation also imposes restrictions on enrollment for individuals with low incomes. Currently, those earning at or below 150% of the federal poverty level qualify for a year-round special enrollment period. However, beginning in the 2026 plan year, individuals who apply during this period will not be eligible for premium tax credits or cost-sharing reductions.
It is advisable for low-income applicants to seek coverage during the designated open enrollment period, which typically runs from November 1 to January 15, although specific dates may vary by state. Individuals who experience qualifying life events, such as job loss or marriage, may still access subsidies through other special enrollment periods.
Impact on Immigrants Seeking Coverage
The new law also alters eligibility for immigrant populations. Currently, lawfully present immigrants can access marketplace insurance and qualify for subsidies. However, the revised legislation limits eligibility to specific groups, including lawful permanent residents and certain Cuban and Haitian immigrants, effective from tax year 2027. Other categories, such as refugees and asylees, will no longer qualify for subsidies.
Individuals in these affected categories should assess their immigration status and explore alternative insurance options if they become ineligible for marketplace coverage.
Changes to Advance Premium Tax Credits
Under the current system, advance premium tax credits assist with health insurance premiums based on estimated annual income. If actual income exceeds the estimate, individuals may have to repay a portion of the credits to the IRS. For 2024, individuals earning below 200% of the federal poverty level would face a repayment cap of $375.
The new legislation removes this cap on repayments beginning in tax year 2026, meaning those with low or fluctuating incomes could be required to repay the full difference in tax credits. To mitigate potential repayment amounts, applicants should provide accurate income estimates on their applications.
Individuals can also opt to claim the tax credit when filing taxes instead of receiving it in advance, although this would require paying full premiums upfront, which could strain finances.
As the landscape of health insurance continues to evolve, it is essential for individuals to stay informed about their coverage options and any legislative changes that may affect their access to affordable healthcare.
