How ACA Subsidies Are Lowering Health Insurance Costs for Gen Xers

• Lisa Jolly is paying less for her health insurance thanks to increased tax credits.
• These subsidies are intended to reduce the price of health insurance purchased through the ACA marketplace.
• The subsidies could expire next year, increasing health insurance costs by millions.

When Lisa Jolly signed up for the Affordable Care Act marketplace, it was a lifeline, she said.

Jolly, 55, was diagnosed with type 1 diabetes when she was 32. Since then, she has had worsening health problems, including neuropathy, stage 3 kidney disease and anemia.

For most of her life, Jolly was provided for by her ex-husband’s employment. But when they divorced in 2021, she lost that coverage.

“I was probably close to tears every day, wondering what the hell I was going to do,” she said.

Jolly enrolled in the ACA marketplace the following year and qualified for increased premium tax credits, which aim to lower the price of health insurance purchased through the ACA marketplace. She pays $96 a month for health care coverage, according to documents reviewed by Business Insider.

“I remember being extremely grateful and almost amazed that there was something out there that was going to help me afford health insurance,” she said.

Jolly is among the millions of Americans who are using the increased tax credits to afford health care coverage and who could see costs rise next year if the subsidies expire.

According to the Center on Budget and Policy Priorities, 19.7 million ACA enrollees qualified for enhanced tax credits this year, which is 92 percent of all ACA enrollees. In addition, the increased tax credits reduce consumer costs by about 44 percent, saving the average enrollee $705 annually, according to a report released July 26 by KFF, a nonprofit health policy group.

The subsidies were introduced in 2021 as a temporary measure and expanded eligibility to include enrollees with incomes above 400 percent of the federal poverty line — which is $60,240 for an individual and $124,800 for a family of four. In 2022, the Inflation Relief Act extended the subsidies until the end of 2025.

According to an analysis by the Center on Budget and Policy Priorities shared with Business Insider, without the increased tax credits, Jolly’s monthly payments could rise to $275, about 186% leap.

“It would have a huge negative impact on my life,” Jolly said.

The grants helped Jolly afford health care coverage

Jolly lives in Steubenville, Ohio — a town about 30 miles west of Pittsburgh — with her 24-year-old daughter, Jessica. Jolly bought a small house in September 2023 using the funds he received from his divorce settlement.

Jolly receives a monthly settlement payment for her husband, who is her only income. Due to her health complications, Jolly she said cannot hold down a full-time job. She said she is trying to get a part-time job as a teaching assistant, but her health problems mean she is often weak and unable to concentrate for long hours.

Jolly said she is not eligible for many social safety nets. Plus, she said she burned through her savings.

“I’m fighting,” Jolly said. “When you combine rising food costs with rising insurance costs, it becomes almost unbearable.”

Expiration of subsidies could spell hardship for millions of Americans

The results of the November election could determine the fate of the increased subsidies.

On September 25, Democratic Senators Jeanne Shaheen and Tammy Baldwin introduced the Affordable Care Act., which would create increased permanent tax credits. Rep. Lauren Underwood, another Democrat, introduced an identical bill in the House.

The bills would have to pass both the Senate and the House and then be signed by the president to take effect. Its unclear when a decision on tax credits will be reached.

Republican lawmakers oppose the cost of subsidies to taxpayers. Congressional Budget Office and the Joint Committee on Taxation estimate that making the policy permanent would increase the budget deficit by $335 billion over the next 10 years.

Cynthia Cox, a vice president at KFF, previously told Business Insider that Congress could have a divided House and Senate after the election, making it difficult to pass a bill.

“There’s a pretty significant chance that there’s a split in power in Washington, and then it’s anybody’s guess what happens with these subsidies, but it would probably be an uphill battle to renew them,” Cox said.

The Congressional Budget Office estimates that 3.8 million people could become uninsured if the increased subsidies expire, according to Reuters.

For subscribers like Jolly, the hundreds of dollars saved each month have was crucial to securing coverage.

“If we didn’t have them, I don’t know how I would have survived day to day,” Jolly said. “It would have been total ruin for me, and I’m not even talking economically, but I’m also talking about health.”