Health Insurance Marketplaces serve over 24 million hard-working Americans, including small business owners, part-time workers, early retirees, and individuals experiencing life transitions (e.g., new jobs, a move to a new state, marriage, or birth/adoption). For the past four years, individuals who purchase health insurance through the Marketplaces have come to rely on the increased affordability of their insurance enabled by the availability of enhanced premium tax credits (EPTCs).
Impacts to specific groups of Americans are detailed below:
Impacts to specific groups of Americans are detailed below:
Adults over age 55
The availability of EPTCs has had a significant impact on adults over the age of 55. Approximately 6 million older adults are enrolled in coverage, a 63 percent increase since EPTCs were enacted.
$1,910
Average yearly decrease in premium costs, or dollars saved, for 55 to 64 year-olds in Washington due to ETPCs.
Thanks to the EPTCs, a 60-year-old living in York County, PA, making around $62,000 annually, pays a premium of $439/month. Without the EPTCs, their monthly premium would jump to $1,556/month, or $18,672/ year consuming 30% of their annual income.
Maintaining health insurance coverage can be especially challenging for older adults who no longer have access to employer benefits. They are too young to qualify for Medicare, but they are likely to have some form of income, including from part-time work or retirement savings. Moreover, adults in this age group are often caregivers of aging parents or partners with serious health conditions. These caregiving responsibilities can place limitations on employment, as well as additional financial pressures on the household.
Age rating policies, common in the private insurance markets, allow insurers to charge older adults up to three times more for their insurance because of the increased prevalence of chronic diseases and the expectation of greater healthcare utilization. This means older enrollees will face premium increases three times as expensive as their younger counterparts if EPTCs expire. Many will not be able to afford this cost, and they may go uninsured as a result, despite often having significant health care needs. This could lead to a greater prevalence of unmanaged chronic illness and higher long-term costs for both the individuals and the health system, including for Medicare, when more seniors enroll with unmanaged and complex medical conditions.
5.9 million
Marketplace enrollees over the age of 55.
63%
Enrollment increase among 55+ year olds since EPTCs were enacted.
$600-$4,600
Estimated range of annual premium increase for 50-64 year olds if EPTCs expire.
Small Business and Gig Workers
Marketplaces give entrepreneurs, freelancers, gig workers, and many others the flexibility to start and run their own businesses without risking access to benefits.
Estimated Premium Increases for Self-Employed Individuals in California if EPTCs Expire
51%
< $58,320 annual household income
77%
> $58,320 annual household income
Scott, from North Yarmouth, ME, enrolled in health insurance through CoverME.gov because his employer could no longer afford to offer health coverage. Scott was relieved to find affordable health coverage for himself and his daughter through CoverME.gov. Thanks to the EPTCs, his coverage is more affordable than his previous employer plan. Scott believes that continuing the EPTCs helps hard-working, tax-paying people like himself afford health insurance and levels the playing field with those who work for large companies.
Millions of small business owners and self-employed individuals are served by the Marketplaces, which provide them with tools to navigate complex coverage options while ensuring choice, transparency, and reliability of insurance. Health Insurance Marketplaces are the only option for sole proprietors in many states.
Some Marketplaces have set up tools to support small businesses with options to provide health coverage, including the adoption of Health Reimbursement Arrangements, which allow businesses to use pretax dollars to cover insurance purchased through the individual market.
Availability of affordable health insurance provides these businesses with more autonomy over how to direct their resources. They may choose to increase wages or invest in growth strategies, with the peace of mind that they and their employees have affordable health insurance options through Marketplaces. If Marketplace premium costs rise, due to EPTCs expirating, employers may no longer be able to make these types of investments.
In the face of significant health insurance increases, small businesses may be forced to close, cut back, or pass through price increases to their local economies.
4.2 million
Estimated number of small business owners and self-employed individuals enrolled in the Marketplaces.
82%
Percent of enrolled small business owners and self-employed individuals who receive premium tax credits.
~1/3 and growing
Proportion of the U.S. workforce participating in the gig economy.
Middle-Income Families
The new EPTC structure eliminated a tax credit cliff that previously prevented many middle-income families — those with income over 400% of the federal poverty level (FPL), meaning individuals making $62,600 a year or more, or $128,600 for a family of four — from accessing affordable coverage. Since EPTCs were enacted, enrollment among this population has increased by over 1 million, more than tripling enrollment among middle-income families.
$6,000
Estimated annual premium cost increase for households >400% FPL in Rhode Island if EPTCs expire.
In Union County, NJ, a family of four earning $128,560 can expect to pay $15,338 more per year for coverage if EPTCs expire. In total, this family will pay nearly 23% of their income to pay for health insurance.
The EPTCs ensure that no one pays more than 8.5 percent of their annual income toward premiums for a benchmark Marketplace plan. In practice, this means an individual making around $65,000 annually pays $5,525 in premiums a year for a silver-level Marketplace plan, not including the additional out-of-pocket costs the consumer must pay in the form of deductibles, co-pays, or other cost-sharing.
As Americans experience rising costs for many necessities like food, rent, and transportation, a substantial increase in health insurance premiums, due to the expiration of EPTCs, will cause many families to have to choose between these necessities. This will leave many unable to afford the hundreds, if not thousands, more dollars needed each month for health insurance.
1.6 Million
Total Individuals > 400% FPL enrolled in Marketplace coverage
1.2 Million
Growth in >400% FPL enrollment since 2021
$18,415 per year
Average annual increase in premium costs for a family of four earning 410% FPL*
*Based on KFF analysis of family of two adults, aged 35, with two children
Rural Communities
Many rural communities face provider shortages, older populations, and high healthcare costs, leading to limited insurance competition and insurance premiums that can reach tens of thousands of dollars annually. These factors have historically left more rural residents uninsured.
$31 million
Estimated total increase in annual premium costs for enrollees in rural Maine without EPTCs.
Ian Billick, the mayor of Crested Butte, CO, has said it could be devastating for employers in his community if enhanced subsidies go away, and a personal hardship for his family. Without tax credits, their health insurance plan would cost them $2,500 a month — that’s $30,000 a year. Because of the EPTCs, his family’s costs are reduced to $1,000 per month.
Marketplaces have expanded access to coverage and increased insurer competition in rural areas, resulting in significant enrollment gains across this population. These achievements have been amplified since enactment of the EPTCs, with rural residents seeing some of the most significant benefits from the EPTCs.
However, if the EPTCs expire, rural populations are expected to experience some of the steepest increases in premiums, leaving many uninsured because of no affordable insurance options. This will undermine the recent gains that have supported timely access to care, improved population health management, and the stability of providers in rural regions.
Furthermore, many rural areas are home to hospitals that operate on thin financial margins. Increases in the uninsured and uncompensated care put rural provider viability at risk, leading to a larger likelihood that more rural hospitals will close and leave rural communities without the lifeline of nearby medical care.
83%
Growth in rural enrollment from 2021-2024.
2.5
Average number of Marketplace insurers in rural counties, compared to 3.1 in metro counties.
28%
Average additional savings rural residents experience from EPTCs compared to their urban counterparts.
