A Ticking Clock: How States Are Preparing for a Last-Minute Obamacare Deal

A family in Virginia Beach, Virginia, just learned that their health plan’s deductible will increase from $800 to $20,000 next year. About 200 miles north in Maryland, another household learned it would pay $500 more per month to insure its offspring in 2026. And thousands in Idaho were greeted with insurance rates that will cost an average of $100 more each month.

As shopping season opens for Affordable Care Act plans in some states, customers will face sky-high costs for their health insurance next year. Additional federal subsidies put in place in 2021, which made coverage more affordable for millions, will expire at the end of this year unless a gridlocked and inactive Congress acts.

With Democratic and Republican lawmakers deadlocked, the federal government shut down on Oct. 1, spurred by the need for about $353 billion over a decade to continue providing enhanced ACA subsidies to about 24 million people. Both camps have come together, with Republicans saying Senate Democrats must vote to reopen the government before they are willing to negotiate on the costs of the ACA.

If Congress can reach an agreement in the coming days or weeks to extend some subsidies, the prices and types of plans available in online marketplaces could change dramatically, bringing unprecedented uncertainty and upheaval to this year’s open enrollment process, which begins in most states on November 1.

Michele Eberle, executive director of the Maryland Health Benefit Exchange, the state-run marketplace, is strategizing if that happens, including the possibility of pausing enrollment so her team of 200 can update plans to reflect any changes, should Congress pass a new ACA subsidy bill.

“We will do whatever it takes to ensure we can provide Marylanders with the most affordable health coverage,” Eberle said. “We don’t really know how that will be done until we understand what Congress might do.”

“I think everyone realizes that depending on what happens, we can’t flip a switch overnight,” she added.

Exchange customers in Maryland can expect to pay an average of about 35% more next year, even with help from the state, which has agreed to offer relief grants if federal government cuts expire at the end of this year. Eberle said notices of the premium increases — which assumed federal subsidies would expire — had already been sent to mailboxes and inboxes. For example, a middle-income family of four in the state will see their monthly premiums increase from $916 to $1,427.

People living in most states still use Healthcare.gov, the federal marketplace, to sign up for coverage. The Centers for Medicare & Medicaid Services, which oversees the federal exchange, declined to answer questions about how quickly the agency could adapt to changes Congress might make after enrollment begins.

“CMS does not speculate on potential congressional action,” Health and Human Services spokeswoman Emily Hilliard said in an email.

Like other states that operate their own ACA exchanges, California sent letters to policyholders with information about their 2026 coverage, with costs calculated assuming the subsidies would expire.

But the California stock team has also designed backup plans to contact policyholders and revamp its online marketplace if Congress acts before the end of the year.

“At no point is it too late,” said Jessica Altman, executive director of Covered California, the state’s exchange. “We are ready to move whatever mountains we can move to bring about change as quickly as possible.”

It could take about a week to reprogram the site to reflect prices that take into account more generous subsidies, if Congress approves them exactly as they are now, Altman said.

States may also need to update premiums themselves to reflect the new rates. Most insurers submitted two sets of premium rates to states this year in case Congress agrees to extend the subsidies.

Right now, many buyers are seeing the set of higher rates that insurers plan to charge if the subsidies expire.

Insurers say it is necessary to raise premiums without subsidies because they expect younger, healthier people to drop coverage rather than pay more. That would leave insurers with a pool of sicker and older people to cover.

If a subsidy agreement is reached, insurers could reduce premiums.

The complications don’t end there.

If Congress passes a subsidy deal after customers have started choosing their plans, people might see the new prices and want to reconsider the type of coverage they already signed up for. Enrollees can change their plans while enrollment is open, through January 15 in most states.

Dozens of insurers offer ACA plans across the country. These plans vary widely in terms of which doctors or drugs they cover, as well as how much customers pay for co-pays, out-of-pocket costs for medical services, and how much deductibles they pay before insurers kick in.

Some people might be willing to pay a higher monthly premium in exchange for a lower deductible. Others, especially those who don’t expect to pay large medical costs, might risk a higher deductible to keep monthly premium payments lower.

In Virginia, some customers are being offered surprisingly high deductibles for next year, said Deepak Madala, director of Enroll Virginia, which helps people sign up for coverage.

He said he was helping a Virginia Beach family facing an increase in the cost of premiums from $70 to about $280 a month.

To purchase a similarly priced plan, the family, whose household income is around $60,000, should consider coverage with a deductible of $20,000 or more, he said. Currently, their deductible is $800.

With premiums and deductibles this high, some customers might rethink their coverage altogether, he said.

They decide “whether to go without it or move to a plan with a very high deductible,” Madala said of the options available to ACA customers.

The Pennsylvania-based exchange, which last week began sending out notices detailing 2026 rates, estimates a 102% increase in premiums for its roughly 500,000 customers. About a third of customers are expected to drop their coverage, said Devon Trolley, executive director of the Pennsylvania Health Insurance Exchange Authority.

The timing of any subsidy agreement reached by Congress, however, is most precarious for the approximately 135,000 Idahoans enrolled in ACA coverage.

That’s because their state opened registration on October 15, weeks before the rest of the country — and it will end earlier, on December 15.

While ACA enrollees face average increases of 75% for their coverage costs, about 20% are expected to drop out, said Pat Kelly, executive director of Your Health Idaho, the state exchange.

Idaho is prepared to revamp its website if anything changes regarding the subsidies — a process that could take days — and has “notices ready to go” to inform policyholders of additional savings, Kelly said.

“We will strive to do it as quickly as possible and make sure it’s done right,” he said, adding that factors such as day of the week or proximity to the Thanksgiving holiday could add time.

If Congress waited to act until federal subsidies expired on Dec. 31 — which Republican House Speaker Mike Johnson has repeatedly cited as a deadline for a deal — it would be too late for Idahoans.

“We would run out of open registration and we wouldn’t have enough time to make changes,” Kelly said of any deal reached in Congress after mid-December.

KFF Health News is a national newsroom that produces in-depth journalism on health issues and is one of KFF’s primary operating programs, an independent source of health policy research, polling and journalism. Learn more about KFF.

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